Does this make sense.

[Larry Yinger]

I apologize as I could fit the full question in the title.

We currently pay our nanny/sitter $500/week to watch our two young children.  This is under the table and not tax deductable.  Our arrangement works fine for both our families.  She rents a 3 bedroom apartment and just had a new baby so in a few months she could really use a 4th bedroom.

My question:  Does it make sense to buy a local property and let her live there (essentially) rent free and pay her the difference?

My justification:  We are throwing away (let's assume) $1,000 every month.  Meaning we give her $2,000+ and she hands half of it over to her rent.  Doesn't it make sense to instead invest that $1,000/month into a property?

What am I missing?  Potential pitfalls?  What is the best setup for this?  Do we not pay her the rental amount and put it towards mortgage or do we pay her full salary and she pays us rent every month?

For what it's worth, I have zero investment properties but have been itching to get started.

[Colleen Arends]

I am a live out nanny. I would not want my boss of any job to also be my landlord. I would say keep your business and personal life separate. Just my opinion. Good luck.