Author Topic: Rental homes in areas you would eventually like to live  (Read 1370 times)

LearningMustachian72

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Rental homes in areas you would eventually like to live
« on: May 09, 2018, 12:47:16 PM »
Hey!

I plan to invest in rental property in the next 3-5 years.  At this point, I do not plan to grow a huge portfolio...I like the idea of buying two properties:

1 in the South (Florida/Texas/Arizona.  I live in the north and would eventually like a southern escape home for 1-2 months/year.

1 in the city nearby.  I would like to buy a reasonable home in a walkable area, rent it out while my kids are in school and then move into it and remodel as a home for when my kids move out.

Has anyone done either of these?  For those with experience, do you think this is a good way to start out in real estate investing?

Thank you in advance!

waltworks

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Re: Rental homes in areas you would eventually like to live
« Reply #1 on: May 09, 2018, 03:02:20 PM »
Assuming those houses will be profitable, sure. But I'd personally look for deals that make me money and worry about whether I want to move into them later. The kind of house that makes a great rental property might or might not (IMO probably not) be the kind of house/location that's what *you* want.

That said, I did do this once. I 1031'd into a place that I thought I might want to move to, despite it being a mediocre/bad deal as an investment. I never moved there, but got lucky and property prices increased nicely in the meantime, so while I didn't make anything in cash flow, I did fine on appreciation when I eventually sold. I would probably not do it again knowing what I do now.

-W

LearningMustachian72

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Re: Rental homes in areas you would eventually like to live
« Reply #2 on: May 09, 2018, 03:23:04 PM »
That's a good point...make your money elsewhere (Most profitable neighborhood) and then buy the place you'd like.

tralfamadorian

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Re: Rental homes in areas you would eventually like to live
« Reply #3 on: May 09, 2018, 03:49:38 PM »
+1 Walt's comments.

It's part of my long term FIRE strategy to purchase the most profitable rental properties now then 1031 them into others that would later be converted into lifestyle properties for my own use.

LightStache

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Re: Rental homes in areas you would eventually like to live
« Reply #4 on: May 09, 2018, 09:06:17 PM »
+1 walt and tralf

Lmoot

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Re: Rental homes in areas you would eventually like to live
« Reply #5 on: May 11, 2018, 05:10:48 AM »
I still own my first house which is in a bigger city, close to my hometown. I've been renting it out for the last few years but I plan to move further north, or west, or northwest---somewhere else....and keep the house as a second home/ possible retirement home.

I currently live in a destination area of FL and though I'm clawing at my eyeballs to leave because I've lived here my entire life, I recognize the benefit of having a place close to family and my roots, and somewhere warm to escape to since I plan on living somewhere with spring like temps during the summer, but blistering winters that I'm sure I'd want to escape from.

I like knowing I'll always have this house because it's fun to make plans about additions and renovations and I'm planting trees in the yard as well (it's a big yard), and establishing a garden and landscape that will take many years to grow into. I've already renovated the house and worked on it myself as well, and I know its history well. I just like the idea of being a part of something with a lot of personal history. As I get older I get more nostalgic, and I know this is a house that will remain a home, even while I'm not there, and its significance will only grow as I grow older.

So...not a financial reason, but there are other reasons to consider rather than just financial, at least if sentiment is important to you.
« Last Edit: May 11, 2018, 05:14:29 AM by Lmoot »

Dicey

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Re: Rental homes in areas you would eventually like to live
« Reply #6 on: May 11, 2018, 08:02:22 AM »
I did it and don't really regret it, but I would have come out way ahead to put my money in the stock market until I was ready to move in to it. Way ahead. Fortunately, I had other eggs in other baskets. This puts me firmly in Walt's camp.