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JohnnyB
07-13-2008, 08:39 PM
OK,

Have very interested buyer in my home (wants closing by August 30) and I am going to need to rent for the next 8-12mos while I plan and build my next house.

Looking at duplex rental properties, I'm going to pay almost as much in rent for my half of the duplex ($850) as it would cost to own both units ($1000/mo). Those who own rental properties, talk me into or out of this :confused:

I'm going to talk to my lender and make sure this won't hurt my financing for my next home and probably talk to my financial planner, too.

Cloaked
07-13-2008, 09:20 PM
Those who own rental properties, talk me into or out of this :confused:

Don't do it...

If you are serious about planning a house, and for no more time that you'll be renting a single unit, don't get stuck with a duplex that may not resell on a flip.

Rentals are OK if that is your game, but renters are not on the same page.... In my opinion and experience (again for the little time you'll rent), I'd not even consider it.

$0.02

atlfootr
07-13-2008, 09:33 PM
He ment to say, IMHO and experience (again for the little time you'll rent), I'd not even consider it.

:twocents:

:D:D:D

Cloaked
07-13-2008, 09:43 PM
He ment to say, IMHO and experience (again for the little time you'll rent), I'd not even consider it.

:twocents:

:D:D:DHope to see you soon. Your panties are mine.

JimN
07-13-2008, 11:09 PM
I wouldn't get into a rental property for the short-term, unless your finances would allow you to buy that and build a house without ending up really strapped if you can't sell the duplex. If you do buy it and have a renter signed up for a decent length of time, your share will be far less than theirs and even if you can't rent your half, it won't cost more than a couple of hundred a month. OTOH, if you find a renter for your half before you move out, you'll be in pretty good shape, as long as you plan ahead and learn what your rights and responsibilities as a landlord are, the renter's rights and responsibilities, and what to do if there's a problem.

Here's a link to a site that has a buttload of info. You can drag/drop lease clauses that you want to use and make up your own or you can go to an office supply and buy pre-printed forms but inform yourself first. My renter pays 74% of my mortgage payment. My last renters were POS and it took a lot to get it in rentable condition but since everything I spent was 100% deductable, it didn't kill me. DO A THOROUGH BACKGROUND CHECK ON ALL POTENTIAL RENTERS AND MAKE AN UNEXPECTED VISIT TO THEIR CURRENT PLACE BEFORE YOU AGREE TO RENT TO THEM. That way, you can see how they live and if your rental turns into a pig sty, it won't be a surprise.

If you decide to keep the rental peoperty, even if it doesn't appreciate, the income will really help. If you plan well, you can do some improvements along the way and have expenses at tax time, which will offset some of the income and make the place worth more, both in fair market value and in the rent $ you can ask for. If it's in good shape and really needs nothing, keeping the assessed value low will also keep you from getting killed on property tax.

dapicatti
07-14-2008, 01:02 AM
We have had rentals for the last 15 years, some good experiences, some bad. We always have thought of them as rentals, not a quick flip or money making scheme. We have experienced good appreciation on our rentals, (allowing us to buy more toys like the X star) and good income. But, we are long term landlords. We don't do any of the day to day stuff ourselves, its worth the money to pay a leasing company to screen and collect rents etc. We had one really bad renter do an amazing amount of damage, but all the rest have been great. It's a great tax break for us, but you have to know what you are doing.

stuartmcnair
07-14-2008, 11:45 AM
Our rental properties are owned by a company that we set up just for the properties. I would do that so you have some distance between your personal assets and the rental properties. Another thing to consider is to not worry about the principal of the mortgage on the rental properties. Set them up with an interest only payment at 80% of the property value so you can keep more of the rental income and get the full tax writeoff of the interest.

damaged442
07-14-2008, 12:55 PM
I have a good friend of mine that has several duplexes and a few single family houses that he rents and he does quite well. It helped him score a beautiful Maristar 225VRS. Some houses do better than others, especially when it comes to good tenants. You really don't want to jack up the rent on good tenants. The bad tenants though...they can kill ya. To reiterate what some have said, he is in it for the long haul, not just for a quick flip. I don't know if it's something I could do. I would have NOOOOO patience for bad tenants.

JohnnyB
07-14-2008, 01:04 PM
I should clarify that I'm not planning to flip it. If I do this, I would do it to keep the property as this unit is only about 2mi from where I plan to build my new home, is right on my way to work and it is in a smaller community.

The idea of throwing away a years worth of rent when I could own it and generate future income is what got me thinking in this direction.

I have a couple of friends that own rentals and have had good and bad tenants. Yes, screening them is the key.

Keep the thoughts coming.

-J

wakeX2wake
07-14-2008, 02:15 PM
got a good friends in the rental property business... always a good idea to let someone else pay for your property... its a good investment no matter how big of a pain the tenants are.. if nothing else hire someone to manage it for you... i think my friend charges a universal 8% of the rent to manage... if you do your own management i'd require a credit check... even if you don't have the means to get one done... this will immediately run off most of the bad tennants... just a couple thoughts of mine... also... just a suggestion from myself that if you take the profits from rent and keep that in a seperate account instead of putting toward your personal finances you'll have a lot less heartache when it comes time to update/remodel/fix stuff

milkmania
07-14-2008, 02:19 PM
Hope to see you soon. Your panties are mine.


w.t.f.???:confused:

milkmania
07-14-2008, 02:21 PM
I wouldn't get into a rental property for the short-term, unless your finances would allow you to buy that and build a house without ending up really strapped if you can't sell the duplex. If you do buy it and have a renter signed up for a decent length of time, your share will be far less than theirs and even if you can't rent your half, it won't cost more than a couple of hundred a month. OTOH, if you find a renter for your half before you move out, you'll be in pretty good shape, as long as you plan ahead and learn what your rights and responsibilities as a landlord are, the renter's rights and responsibilities, and what to do if there's a problem.

Here's a link to a site that has a buttload of info. You can drag/drop lease clauses that you want to use and make up your own or you can go to an office supply and buy pre-printed forms but inform yourself first. My renter pays 74% of my mortgage payment. My last renters were POS and it took a lot to get it in rentable condition but since everything I spent was 100% deductable, it didn't kill me. DO A THOROUGH BACKGROUND CHECK ON ALL POTENTIAL RENTERS AND MAKE AN UNEXPECTED VISIT TO THEIR CURRENT PLACE BEFORE YOU AGREE TO RENT TO THEM. That way, you can see how they live and if your rental turns into a pig sty, it won't be a surprise.

If you decide to keep the rental peoperty, even if it doesn't appreciate, the income will really help. If you plan well, you can do some improvements along the way and have expenses at tax time, which will offset some of the income and make the place worth more, both in fair market value and in the rent $ you can ask for. If it's in good shape and really needs nothing, keeping the assessed value low will also keep you from getting killed on property tax.

I think I missed that link:confused: