Hey guys!! I am currently 23 and I want to buy a house next year. I am currently going to finish paying off my school debt by Oct. then save for a down payment next year. I’m currently have an engineering job in Raleigh. This would be my first house. I live in Raleigh, NC but there seems to be some nice houses in Selma. It’s about $120,000 for 6 bed and 4 baths. But I don’t really plan on living in this unit because it is too far from work for me. I would want to still live in Raleigh and rent out the place that’s an hour away. Do you think this is wise to buy your first house this far away, not live in it and rent it out?
Hi @Jason Cook -
Personally, I don't think there's anything wrong with the idea of being a renter while also owning rental property. And, I'm not saying that buying a rental property in Selma is a bad idea, but I would suggest you consider another option at the same time...
You'd be buying Selma as an investment property and should expect to put down 20% or more - $24k+. The other option would be to buy a multi-family somewhere in the Triangle, use an FHA loan for the purchase and live in one of the units. You'd drop your personal rental payment ... would have a lower down payment ... and, potentially, would receive as much rent from the other side(s) of the property as you would from the Selma property.
This property just went pending tonight, but is a good example - 2608 Stewart Dr, Raleigh. It's a 4plex listed at $375k - 3 of the units that are currently rented are bringing in $1995/mo. You put 3.5% down ($13k) - an interest rate as high as 4.75% would only have a PI of $1887/mo.
Just an idea...
@Jason Cook I’m a couple years older than you. I own several properties an hour away from me in eastern NC. I rent where I live in Durham. So it’s very doable. Granted I’ll probably buy a house in a few years, but right now I don’t need the space