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Buy to Rent Out & Rent Where You Live

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LightningHelix

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Hello all,

I've been reading alot of articles lately that claim you should rent where you want to live and invest in properties to rent.

Personally, I think I trust the members here on the forums about this more than those who might have alterior motives.

So what's the concensus? Is it wise advice or malaligned?

Cheers!
 

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The Abundant Man

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Michael Burgess

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I'm quite pleased with my personal decision to do that, with a slight twist.

I bought my first 4 unit building in a different city last April, and it was quite a commute to operate my landscaping company - but it let me get into the real estate game, fix up some of the units in the building, and produce cashflow after monthly expenses.

Just a month ago, I bought a personal house with a workshop in the community where I want to live... Now I'm able to rent out the entire 4 unit apartment building, and just got my next 2 units under contract.

The idea of separating investment properties from your own primary residence (whether you decide to own or rent) is solid, because it allows you to optimize your investments for financial performance instead of personal quality of life. I wouldn't want to live full-time where my rentals are, but other people do, and I'm happy with the numbers.

I definitely recommend getting into the real estate game any way you can, and as you improve your own understanding of real estate, you can have a more nuanced perspective about what could work best for you. Good luck!
 

thechosen1

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It's a waste to rent where you live, but it is a good idea to own property to rent out.

Mortgages for your primary residence are some of the best deals you can get from a bank, ever. So not getting one is a waste. FHA, etc. You can get one for a live-in flip, or for a small multifamily like in the gold thread above.

That would be much smarter than renting an apartment and buying a separate investment property - you will have a much higher down payment on that one and probably higher interest too.
 

Jon L

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The advantage of renting your residence is it removes the Home-Depot-itis that comes with home ownership. If you buy a place to rent out, you'll only make improvements to it that make sense financially. In your own place, 'gosh, this $750 kitchen faucet sure does look nice...'
 

WJK

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Hello all,

I've been reading alot of articles lately that claim you should rent where you want to live and invest in properties to rent.

Personally, I think I trust the members here on the forums about this more than those who might have alterior motives.

So what's the concensus? Is it wise advice or malaligned?

Cheers!
RE has been my business for the last 45 years. Owning residential rentals is a whole business model. It's plain and simple hard work for the person who manages his own properties -- or you can hire someone to do that work. It's not glamorous nor easy work.

As far as renting a personal dwelling -- that depends on what you want to do and how you want to live. It also depends on your personal resources and skills.

These are some questions:
Can you afford to buy a property?
Can you afford to buy small units?
Do you need a loan or can you pay all cash?
Can you do the rehab work yourself?
Or must you hire someone to perform that work?
Do you have the cash on hand to pay for any necessary rehab work and materials?
Can you live in a unit that is under construction?
How are you at mowing lawns, cleaning toilets, and picking up trash?
 

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