Updated over 11 years ago on . Most recent reply
Break a Lease to Buy a Duplex
How does this logic look for breaking a lease early to buy a Duplex with the intent of renting out one side:
6 months left on the lease; $1500 to break it; $1200/mo for rent+util
Mortgage on Duplex = $1400; rent 1 side for $900; Mortgage-rent+util($200/mo) = $700/mo out-of-pocket.
I would save $500/mo ($1200-$700), which would pay for the lease-break in 3 months.
Suppose it takes as along as 2 months and $2,000 to repair/improve the unit and find a renter - that's an 11-mo break-even point (because I paid the full mortgage 2 months), which is 11 months of building equity as well.
OR - should I just not break the lease and wait 6 months? Basically what I am trying to figure out how to do here is determine if I can create value in 6 months greater than $1500, in which case I should break the lease.
I suppose it depends on how good of a deal I find, huh. - Just curious what other's thoughts are.