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Updated almost 7 years ago,
House Hacking: Am I Doing This Right?
Hello, just got my first property residential property under contract a couple days ago. Still needs to be inspected and check out, but I just wanted to get the advice of the group on a few things.
3/2.5 with a detached guest house. I'm single, no kids, going to move into the guest house for a year or two and rent out the big one.
Purchase price: 250k
Amount Financed: 237,500k (5% down)
Projected PITI: 1,800/mo or so
Market Rent: 1,500/mo (main house) & $800 (1bdrm that I'll live in initially)
I understand this isn't the deal of the century and I need to account for expenses related to vacancy, repairs, capex, etc, so I won't REALLY be living on a $300/mo "rent." But, it's near our small downtown and I can walk to work from this location so it has some perks to me outside of just income. With that being said, I'm not going to live here forever and in 3-5 years will be looking at this thing from strictly a business standpoint.
Questions to the group:
-Should I put more down?
-What should I be projecting to pay myself in rent every month to help build up the emergency fund and cover any repairs or expenses associated with the property?
-I would assume I shouldn't expect rents to rise to have the "1% rule" make sense, but should i expect decent cashflow from this thing eventually assuming my town doesn't have a mass exodus?
-It is probably not smart to count on refinancing in 3-5 years to help reduce expenses considering how rates are starting to climb, is it?
Thank you and I appreciate any feedback