First Timer Home Buyer - Looking at a duplex

[Yvette Chung]

Hello all -

I am a first time home buyer with no experience in RE other than knowledge acquired from my lurking on BP. I decided that my first step should be to find a duplex or small MFH to "house hack", as I am currently renting. 

I have looked at many houses in the Philadelphia area but many of the places I have gone to were no areas in which I am comfortable living in. Finally I have located a property that I would feel very comfortable living in but of course it comes with a premium. I am thinking that it's ok to get this property but again, I am really nervous about this. 

Here is the property details:

Duplex - 2bed/1bath each

Each apartment can rent for ~$1100 as it stands

Real Estate taxes: $3100 per year 

Owner pays water and sewer - which averages to about $100 per month

Price of the Property is $272K.

In a B/B+ area, stable renters and vacancy rate should not be too much of an issue.

Currently I pay $800 in rent in a different area. If i go through with this i would occupy one unit but eventually will move elsewhere and the plan is to rent them both out.

Can you please let me know what you think? Am I close to making a financially stupid mistake?

Thank you!

[Julie Marquez]

@Yvette Chung Welcome to real estate investing! That is a great decision to house hack as the first step. While those numbers aren't anything to brag about for an investor, it's a place you are going to occupy and you need to be comfortable with the area. Having a duplex is great experience owning a property and being a landlord - and that's the experience you need to get under your belt you can't get by standing on the sidelines.

I don't know your area and if this is an outstanding deal, but I am rooting for you to go for it and get your first step in the door of real estate investing. Hopefully your personal finances are in order, and you have enough reserves for other things that might come up in home ownership. Did you run the numbers on the Bigger Pockets calculator?