Updated about 5 years ago on . Most recent reply
Buying a Short Term Rental before your First Home?
Hi!
My boyfriend and I are 30y/o live in Ontario and have a combined income of $155k annually and over $200k saved as a down payment for a house. We've been looking for our first house for quite some time now in the GTA where we work, but have been having no luck during the past year due to the insane rising house prices (a product of low interest rates and those wishing to leave smaller city dwellings during the pandemic). Houses that were $550k about a year ago are now going for about $750k+ where we live and while we 'could' afford to purchase a house here, we view a home as an investment and feel that we'd be on the wrong side of the market for resale in ~5 years (when we would likely need somewhere larger for kids/want to move out of the area).
However, it's always been our goal to move out to a county property (in PEC), as well as own multiple short term rentals for a more passive income. We've recently started to consider purchasing a short term rental in wine country, prior to buying our first home. We figure that this will allow us to take a step in the right direction of our future property goals, bring in a side income that could be used towards rent or another mortgage, and perhaps be a property we can move into in another 5-8 years when we figure out how to transition our careers to the Prince Edward County area. In the meantime, we would intend to rent in the GTA until either prices come down enough to purchase a primary residence here, or until we are able to move out of the area.
Is this a crazy idea? Has anyone else done this cart before the horse path before as well? Are there things we should know about that we may not have considered? etc.