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Updated over 10 years ago on . Most recent reply

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25
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Jon S.
  • New to Real Estate
  • Orange County, CA
8
Votes |
25
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Renting while owning?

Jon S.
  • New to Real Estate
  • Orange County, CA
Posted

Short back story:  My wife and I sold our primary a few months ago and are currently renting.  We live in Los Angeles and are interested in buy and hold strategy with multi-family properties.

My question is do you think it's a bad idea to do buy and hold while we ourselves are renting elsewhere? Naturally one might say to live in one unit of the investment property. However the areas we are considering for the investment aren't areas we'd like to live in. I guess my hesitation is due the fact that it seems counterintuitive to invest in buy and hold while we ourselves are paying rent to another landlord. Now we don't plan on renting forever obviously but with our current capital we can either choose to start REI now and buy our primary later, or vice versa.

Any insight would be greatly appreciated.

Most Popular Reply

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79
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57
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Erin A.
  • Investor
  • Antioch, CA
57
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79
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Erin A.
  • Investor
  • Antioch, CA
Replied

Hey @Jon S. ,

Congrats on deciding to take the REI plunge! How exciting! I have several thoughts to share.

1. How sure are you about buying in neighborhood that you wouldn't live in? Is it a matter of crime rate, distance from work, price point, architectural style? 

2. Yes, I'd agree that common advice to new investors would be to live in one of the units of your multifamily property. It isn't necessarily "bad" or "wrong" to rent while building your portfolio... but I bet you'd come up with another down payment a lot faster if you didn't! It's also an added monthly financial obligation and might lower the amount of any financing you could get. 

3. If you bought a SFR in a neighborhood you like, could you rent out the spare bedrooms or put them on Airbnb?

Good luck!

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