First Multi Home purchase in College

[Mitchell Behm]

Hello,

So I have this idea to buy a duplex/triplex in my college town near my hometown. I want to buy a decent home, live in one side and rent out the other units. I was wondering if anyone has done this before because the houses around here are pretty old, and also mostly college kids live here. I could rent the units out to friends I know that will respect the property for at least one year. Should I continue to pursue this? I currently go to college at the college here, and I have a year and a half left until I graduate and plan getting a job near here, but that could change at any time.

[Matthew Choi]

Hello  @Mitchell Behm,

In my opinion that is a great idea because it gives you an opportunity to have a place to live, but also start your real estate investing business. Not many people in college are thinking the way you are so I tip my hat off to you, it is a great opportunity because you know that you will be able to find some friends to rent to, like you said I highly recommend finding friends that you know will respect your place because that will make your life easier. I recommend you getting an FHA loan so you can put as little as 3.5% down, and find a property that doesn't have too much work to do on it because it is still your first property and you don/t want all the stresses of going through a rehab.

In regards to you potentially moving out of that area after graduation, it works out perfect because with an FHA loan you technically have to live their for 12 months because it is a "owner occupied" property, which means you need to be living in one of the units for at least 12 months. Obviously there are some ways to cut that short like a new job opportunity or if you graduated from school early, but in your case it sounds like you're going to be there for the next 12 months. With that being said if you do decide to move out of the area after graduation you will be fine because you just need to move out of that unit, and rent it out to someone else and then make a little cash flow from the entire property.

The fact that you are in college and already considering house hacking says a lot about you, but don't just think about go take some action and follow through with this because I wish I was thinking like this when I was in school. Your first action step should be to find out how much you can get approved for through an FHA loan, and if you cant afford it on your own, I would recommend a parent or family member to partner with you on the deal so you can make this happen. Definitely take action from here and continue to educate yourself and learn from others that have been successful doing the strategies you want to implement.

Hope this helps!