Owner Occupants ?'s
Who here lives in a Duplex, or Triplex that they currently own and rent out the other portions? I have tons of questions but I will limit them for now..
1. Did you build this property? If so, how much down did you have, and do your rents cover the mortgage, or are you still going into your pocket.
2. What problems have you run into living so close to your tenants?
3. Has living in your "investment" property made it any easier for you to get into investment?
I guess I should give some background. I am 27 years old, and have a good job, making about 40k a year before bonus's. I own my own home that I bought 4 years ago for 66k and have practically rebuilt the house from the ground up. The last appraisal was for 83k, and I have since installed vinyl siding, and completely refurbished the kitchen, dining room, and master bath, and numerous other things. I estimate the property to be worth 90-95k now based on houses in the area (next door sold for 110k, but is a little larger). I have since refinanced the house for 72k, so I don't have the full equity I would have if I had practiced a little restraint a couple years ago when I wanted a new car (stupid, stupid, stupid). But I have matured some since then.
I can do the work, but I don't enjoy it much...I take pride in it but not enough to offset the misery of doing the work. I don't think rehabs are the place for me, since I work 50+ hours a week. I do work nights, so I am available during business hours so this helps alot. What I am most intersted in is buying, and holding rental property, and even more so, building and holding rental property. Right now I just want to get my feet wet, and start positioning myself for this type of investment, something I hope have an OO rental property would help.
Dave[ Edited by dloucks on Date 06/23/2004 ]
Dave,
I would not suggest building your stock of rental property. You will pay for the full cost of construction. In many cases you can buy a rental from a motivated seller for less then the cost of building something new on the same lot.
This post and your other one in the building forum implies that you have thought through some of the ideas. Keep up the good work on that front.
I was recently reading a good book that is lined up with your thinking about building a portfolio. It is called "The Weekend Millionaire's Secrets to Investing in Real Estate." Check it out.
I have been investing for a long time. This is just one book. It happens to be one I am reading now and feels close to your goals.
John
[addsig]
John,
Most likely I will be investing in older, lower cost rental properties, just because of my ability to purchase them with much lower down payments, and there are alot of them in this area. However, alot of my ability to do this hinges on me buying my first rental property and being able to live in it. It was hard enough to convince my wife that that was a good idea when I was talking about a brand new triplex, she would never let one of the cheaper apartment houses fly for our personal residence.
Thanks for the response,
Dave
Hi, Dave.
I own three multi families. I live in one.
I've had zero problems living with my tenants.
In fact, I think there are distinct advantages to an owner occupied multi.
First off, Massachusetts law grants landlords much more discretion choosing tenants for OO units than unoccupied rentals. I'm selective anyway, but I can be very selective when it comes to picking who'll live downstairs. I'm legally allowed to reject tenants without giving "good reason." With the OU units, it's a different story.
Secondly, I think tenants prefer living in an OO property because they know it won't fall to hell. They know when anything goes wrong, I'm right there to address it.
[addsig]