Selling to buy one house or two

2 Replies

Hello,

My husband and I own a home just outside of Phoenix AZ, in the town of Queen Creek. We believe we can sell for about $530,000. We owe $415,500. We want to start getting into investment real estate and build passive income with single family home rentals. Our question is this, when we sell, should we put all our equity into one primary residence. (About $180,000-200,000) or split it up and buy one primary residence and one rental property.

We have a fairly good income and figure if we bought one house and threw extra money at it that we would have it paid off in about 2 years. At which point we could turn it into a rental and buy another primary residence.

Or do we buy two let renters pay down the mortgage on one and pay down the primary house a little slower?

Thanks for any advice!

Hi Codie,

It all depends on what the numbers say and what price target you are going after.  If you are selling the $530k house and downsizing and buying 2 smaller houses 1 to live in and 1 to rent I think its a great idea. 

Now if you want to live in a primary area that costs much more.  You can always buy 2 rental homes rent those out cash flow and rent the primary house you want to live in. Just another option to consider.

@Codie Wintrode Love Queen Creek and San Tan Valley, they have/are becoming wonderful locations to live!

Gathering what I believe are your goals I would consider purchasing two at this time with the intent of turning one (primary) into a rental in a year or two so you end up with 2 rentals and 1 primary within the first couple of years.

You could also look at a 4-Plex in the area also as a way to hedge your income stream a bit more. I love single-family rentals, but I also appreciate the cash flow the multi's provide.

Happy to answer any questions on or off the forum for you.