Help! First Real Estate Investment Strategy
Hello BP community,
I am a new real estate investor and looking to get some advice on my first property purchase. I am 26 years old and reside in Minneapolis, MN.
In an ideal world, I want to purchase a house/duplex that I could live in and rent out to friends for a year or two before turning it into a full-time rental property. This property location might not be exactly where I would like to live in 2 years if I get married, so I am wondering how big of an impact it would have when I try to get another mortgage on a second property? Has anyone else done something similar or is there a better strategy that I could try for my first real estate investment?
Most Popular Reply
@Grant Steiner - If you're planning to rent it for a year or two before moving and getting your own residence the most important things will be making sure you have signed leases and that you are properly reporting everything on your taxes. As long as you have a 12-24 month history of renting the property most banks are able to cancel out the debt obligation when considering you for another mortgage.
I'll possibly be buying a new personal residence in the next year and look to rent out my current home and I do expect the lack of rental history on this property (despite having my other rentals) to negatively impact what a bank will approve me for, fortunately I'm not trying buy a million dollar house so I expect I'll still be okay.