Thoughts on a purchase of a home with an accessory dwelling unit

[Chris Jargens]

Hi all,

Long time reader but I haven't had anything to really post about but now I'm thinking about moving forward more into real estate outside of just owning a property to live in.

I currently own half of a duplex that I've been living in for seven years. My neighbor rents his side out. Both of these properties are in a very walkable urban area of Columbus, OH. I currently have a $1500 mortgage and my unit would rent for about 2200/month. I really want to invest in a duplex building, live in one half and rent out the other side. I can know that being a landlord can be time consuming and I'm trying to make the process as efficient as possible. I just don't want to get in over my head. However, these type of properties rarely come up on the market in the area I live in. Recently, I spoke to my realtor about a home that was being built for 650K about a 2 minute drive from my current home that will include a ADU (450 sq ft) that has a kitchen and bath. It should meet all the zoning requirements to rent out. It would probably rent for 1000-1100. My mortgage on this place would be about 2800/month including taxes and insurance based on the downpayment I can afford.

My question is would this property be worth it? Also, would it be a better idea to keep my current place and rent it as well or sell it? I have about 160K of equity in my current home. I don't relish the idea of managing my current home as well but I don't know if its a good idea to sell. It has increased in value about 5% per year over the last 7 years.