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Updated about 2 years ago on . Most recent reply

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James K.
  • Investor
  • Brooklyn, NY
1
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Can I rent a unit in a 2 family from myself?

James K.
  • Investor
  • Brooklyn, NY
Posted

I own 3, 3 families town houses in Brooklyn that are used solely as investment properties. I plan to buy a 2 family that seems like a good deAl and good property. My question: can I set it up as a rental property like my other 3 then rent one of the units from myself (and the other unit  free market) and take advantage of depreciation etc? 

I am reading a lot of conflicting information on the matter. Would love some more input! 

Thanks

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Bill B.#3 1031 Exchanges Contributor
  • Investor
  • Las Vegas, NV
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Bill B.#3 1031 Exchanges Contributor
  • Investor
  • Las Vegas, NV
Replied

You’ll get a better mortgage and maybe lower property taxes if you declare your half as owner occupied. If you live in it at least 2 years you will also have the option of selling without paying taxes on the gain of your half. 

I see zero upside to renting to yourself versus buying as a primary 1/2. 

Some states ex-empty owner occupant homes from some rules/restrictions as well. I believe fair housing laws are the same. 

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