Opinions on getting started

[Jen Smith]

Hi! I’m new! I would like some opinions on the following:

My husband and I want to get into REI and we love the idea of purchasing a new property every year or two, living in it to get the lower mortgage interest rate, then moving onto the next property. We've heard that technique discussed on the BP forums and podcasts, and are very intrigued by it. We have the goal of purchasing 20-30 units in the next 10 years, mostly MF, but maybe a few SF.

Issue is- we bought the SF that we’re living in now 9 years ago- and we love the house and neighborhood AND I currently run a recording studio/music lesson studio out of the basement. The studio is soundproofed and has a separate entrance for my students/clients. It’s an extremely ideal situation, and the city doesn’t have a problem with it, since I live there. If I were to rent a similar space out elsewhere, it would cost me $1,200+/month. So in actuality, running my business out of my basement completely covers the mortgage & many of the house’s expenses (not to mention the home business tax deductions, etc). I guess I’m kind of doing a form of house hacking with my business…

Back to our investing goals- Could we buy and move into a new property (to get the lower interest rate), but on paper state that my husband is living in the new property and that I am still living in the basement of our current house so that I could then rent the upstairs to a roommate? That way, I’d be getting income from both a roommate, AND my business. That sounds pretty great, if it’s possible!

Or…do we just purchase the new property as an investment-only, keep living at/working out of our current home, and pay the higher interest rate for the new property? I’m sure there are other options too, but I’m only experienced at the “going to the bank and getting a mortgage” route. Maybe the higher interest rate isn’t as big of a deal as I’m thinking it is.

After writing all this out, I’m realizing it probably doesn’t make much sense for us to move out of our current house, since it’s such a great situation with the basement studio. …But I’ll post this anyway just in case anyone has any ideas or opinions on the situation. Thanks in advance and I look forward to learning as much as possible from these forums!

Jenny