Hello!
My name is Emily. I am 24 and just made my first property purchase of a condo in April! I currently have it rented short-term until August when my apartment lease is up. I plan to move into this condo & work on some upgrades with the intention of flipping or renting the condo out in 1 year. My understanding is that I could use an FHA/conventional loan to acquire a 2nd property as a primary residence by the time the year is up.
More on the condo:
- 205k paid; 210k appraisal
- 7k down; currently rented for 1600/mo and total cost is 1200/mo, inclusive of HOA/home insurance. Total out of pocket will be approx 3k by the time I move into it, given start date of mortgage payments.
- Located in an A-class neighborhood & the city is growing quickly; needs updated/upgraded in kitchen/bathrooms and generally in good condition. Home warranty was included w/ purchase.
My questions:
1. Would a HELOC be my best bet for making upgrades without coming out of pocket? What other options might I consider for further research?
2. If I ultimately decided to stay in the condo for a longer period of time, do I have any options for acquiring a second rental property in about a year's time that would not require a 20% downpayment?
3. How do I evaluate if the property would be better to hold onto as a rental vs. flipping? I am expecting home values in this area to continue to increase at above average rates, so I assume I should factor in increased value on paper + rent against the HELOC payments + mortgage/HOA/insurance. What are other important considerations here? I'm not sure how reasonable these numbers are, but let's say 20-30k goes into the condo for it to be worth 250/k and rent for 2-2.2/mo?
Appreciate any and all advice!
