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Updated about 9 years ago,
Good purchase or bad?
Iv'e been looking for a rental home for about 2 months now. Iv'e found a solid place to invest at a price point I can afford.
But, I have another issue. My Mom really wants a new place to live. Although, I tried shopping for a home for my Mom that would cash flow, in case something happened...she didn't like any of the houses I showed her.
She found a home in a great area with some of the best schools, highest income earning area, least crime, etc. etc. and to be honest, I want her to live there. But I also want an asset not an expense on my hands.
So I ran the numbers and found that I could charge her about $100.00 lower then normal rent in the area & that will cover the mortgage, taxes, HOA, & PMI. I didn't factor in any property management or maintenance, because If theres an issue Ill be there anyways to help her out,wether it was my house or not. The home was built in 2013, so I don't foresee to much maintnance anyways.
The home is all updated also, Were having trouble finding places to push that value 10%, but I'm sure theres something I can do.
I know this is all speculation, but the area has a forecast of about 5.7% home value appreciation in the next year. Assuming the market doesn't crash.
Positives.
- My Mom gets a place to live & the home still builds equity every month
-I would only have to put down 10%. Leaving me extra money to look for another house in about 6 months or so.
- I would be able to landlord for my Mom....a forgiving tenant I would say.
- My Mom is a solid renter, clean, stable.
- High appreciation, in a great area.
- Once I make a grand entrance back in to the civilian world I could probably live there and split the rent with my Mom, and commute to school.
Negatives
- if something were to happen ( like she decided to move) the house would become an expense to us. It would not cash flow. So basically this isn't a solid investment unless it appreciates. But I do believe even though there isn't a ROI there is some positives to the deal.
Its listed for 250k I would offer 240k.
So, to my seasoned investor friends, would this be something you would considered as your first deal or is there red flags I'm not seeing?