I am a soon to be in the rental market and am new to being a landlord. Currently me and my siblings are fixing up a house to go on the rental market (my Dad's old house).
I also have been living in a house for 20 years and have probably 160k equity in it. It's a small (1150 sq foot) house. I have about 45k saved up.
I was thinking about moving out and renting my current place. However, I thought of an alternative: Sell the house, and from that, I could buy two or three of rental properties and have some money left over. One downside to that is for the new properties, I'm guessing that I wouldn't make much profit right away, because the mortgage would be higher than the home I have been in 20 years. Also, I still need to get more well versed in valuation of properties. So far I have done some reading and online seminars. But, I'll work on learning more.
Any opinions or ideas? Which scenario do you think would work better?
Real Estate Consultant · Seattle, WA · Member since 2022 · 1k+ posts · 784 votes
4y
Refinance to pull equity out or, depending on first mortgage terms if there is a first mortgage, get a HELOC and use the cash to acquire additional rental(s)
Ok thanks. I will look into loans. Although, I thought a way that would avoid personal debt and more interest would be better.
What is better about the loan rather than cash? Is the idea to hold on to the house I have for longer? Note that I plan on moving out sometime soon anyway.