Have a place to live that pays for itself?

[Springfield Chicken]

I know of people who are tired of paying rent but worried that a mortgage payment would leave them trapped if something happened to their job. I get that.  But you can buy property that includes rental unit(s) and let the renters cover your mortgage.  For example, find a triplex for $50,000 that needs $25,000 in repairs.  You can get an FHA 203K loan for the entire amount with just 3.5% down.  Your principle and interest would be less than $400 per month.  Even if taxes and insurance doubled that (and it probably would not) your 2 tenants in the rest of the building would more can cover it all.  As a Realtor I see good properties like that come up all the time and I'm amazed they don't fly off the shelves.  What do you think?

[Noone]

I thought that I found something in Dist. 7 Springfield that had unbelievable potential and it was bulldozed.

[thelakelander]

This is what I wanted to do coming out of college.  However, prices weren't the same then and now my money has been invested.  However, I do wonder why more people won't consider housing options such as this.

[MusicMan]

Excellent point. I have sold a couple of 4 unit buildings where the owners are homesteading the property and using the proceeds of the rent to pay all of their mortgage (PITI). One of the best ways to build wealth I can think of. 

[floridaforester]

As a Realtor specializing in the downtown neighborhoods, I have had several buyers contact me in the last couple months with this purpose in mind.   Generally they are more interested in duplexes, but of course a triplex or quad would usually cover more than the mortgage but a duplex is generally more marketable and less hassle in terms of dealing with tenants.

Anyone that has ever owned investment properties can attest that dealing with tenants can absolutely be the biggest pain in the ass.  20% are fantastic, pay rent on time and take care of the property, the other 80% fall short on at least one of those items (many times they fall short on both), even with good credit and background checks.

To SF Chicken's point,  I recently put under contract an updated duplex with over 3000 sq ft in SW Springfield for less than $75k.  Each unit will rent for at least $700/mth and this would have been a great opportunity for an owner occupant, but alas, it is being purchased by an investor living in a ridiculous gated community. 

[Dog Walker]

Things are coming full circle in the real estate world.  The reason that there are so many duplexes, tris and quads in Riverside is that mortgages as we know them were unheard of in the early 20th century.  Many more people had to rent so there were many, many "owner occupied" rentals.  50% down, callable mortgages were the norm.

That is also why so many of them are 1400-2100 sq. ft. as they were built for families, not just singles and couples as so many modern rentals are.

[avs]

I have sold several duplexes in Riverside and Springfield to people who need a space for an older parent too.   It is a great way to be close to an older relative but still maintain independence for the parent and child.

[finehoe]

Question:

As a Realtor I see good properties like that come up all the time and I'm amazed they don't fly off the shelves.  What do you think?

Answer:

...hassle in terms of dealing with tenants.  Anyone that has ever owned investment properties can attest that dealing with tenants can absolutely be the biggest pain in the ass. 

[thelakelander]

^True.  A few years back, I had a tenant call me at 11pm because he locked himself out of his bedroom's door and wanted me to bring him a key.  I had to spend 30 minutes explaining to him that I wasn't coming and providing choices on how to:

A) stick a toothpick or paper clip in the little hole on the knob or;

B) get a screwdriver and unscrew the door knob set.

Depending on the tenant, constantly getting bombarded with calls and requests and then hearing excuses why rent can't get turned in on time can be pretty draining.

[Debbie Thompson]

Hire a good property manager, and pay the fee.  It's worth it.  You can even do this if it's owner occupied.  They don't have to know their neighbor is also their landlord, because they pay their rent to the property manager.