First 2 Family Rental Unit

[Tim ODonoghue]

I purchased my first single family home 3 years ago when I was 24 years old. It's a 4 bedroom colonial and I've been renting out 3 of the rooms to friends while I have occupied the 4th. The value of the home has increased and I've been able to put a dent in the principal on my mortgage. I am planning on selling the home after the winter and anticipate a profit of roughly 100-140k.

After the house is sold my plan is to purchase a two family rental unit just outside of Boston. I believe the area I'm looking at (Everett) will see an increase in property values within the next few years due to a new resort/casino "The Encore Boston Harbor" and its close proximity to Downtown Boston (2mi).

There are currently 2 family (4bd/2br) homes on the market for 500-600k. My plan is to put 30-40k down on one of these properties which would leave my mortgage payment at $3,000 +/-  The average monthly rental price for a 2bd/1br is $2,000. I think I would be able to collect roughly $4,000/month in rent.

I am wondering if it's a bad idea to rent an apartment for a year after I sell my house in the spring. It would buy me some time to find the right 2 family to purchase and would allow me to make any necessary upgrades to the property with the cash made from the sale of the single family property. The downside to this is that I will run the risk of not finding a renter and have to float the mortgage/rent for a period of time.

This is my first post on bigger pockets but I think this is the best way to find an answer based on the experiences shared within this community.

Please let me know what you think or if you've been in this situation!

Thank you,

Tim from Boston