Property Q&A in 17552>Question Details

Jasoneisenbe…, Home Buyer in 17552

I am looking to purchase a rental condo for 50k. I currently have 17k line of credit on my first home. I can make 600/m on rental..is this gd move?

Asked by Jasoneisenberger, 17552 Mon Nov 28, 2011

My first home I bought two years ago as a short sale and increased in equity by 44k since then. I have a 17k Line of credit sitting as emergency. My grandfather is selling a 1 bedroom Condo for 50k to me(valued at 65k). Is it smart to use 10k from my line of credit for the new property? I can rent the apartment for 600/mo. Which would net me 200/m.

Suggestions?
Thanks,
Jason

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Answers

1
Hi, Jason;

The answer isn't a simple yes or no. (are they ever?) It depends on (1) what your goals are, (2) if you've calculated all the costs into the deal, (3) what your final ROI (Return On Investment or Internal Rate Of Return) is and whether that's worth it, and (4) are you prepared to be a landlord? I became an "accidental landlord" ~17 years ago and lost my shirt. I became an On Purpose landlord again about 3 years ago after several years of self-study and property management courses and I still learn new things about landlord-ing all the time. Personally, I love it, but it's not fo everyone. Gimme a call any time to chat about your options and how to proceed. I have a simple "sniff test" form I use that can weed out stinkers in about 5 minutes. I use it all the time so I don't waste hours analyzing the details of deals that can't be made good.

BTW - It sounds like you already have a renter. ("I can rent the apartment for 600/mo") Is that the case?

This should be a good start to your answer. Good luck! (c:
-Mark Lipka
Broker - House Sale Advisors Real Estate
(717) 786-9999
0 votes Thank Flag Link Mon Nov 28, 2011
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