Got the 1st! Working towards 2nd Property.
Hello,
Im 26 years old and I purchased my first rental property almost 7 months ago. It's a two family property that I was able to use FHA financing to acquire. The house cost 168k and the taxes are about 6k a year with insurances my mortgage payment is about $1520 a month. Both units are 3 bedrooms which is great because one of the units rents for 1300$. In the other unit I occupy one of the rooms while renting out the two rooms to friends for about $550 each bringing in an additional $1100. See below for current numbers on property number 1.
3.5% Downpayment - 6k
Unit 1=$1100
Unit 2 =$1400
Total Rental income $2500
Mortgage payment - $1500
Total Cashflow = $1000
I save the cashflow in a separate bank account which I use to pay expenses such as the water bill along with other potential maintenance expenses. I have two other jobs (Realtor and Soccer Trainer) I still manage to work and save a majority of my money. I don't have a car payment (yet), Im still driving an 2004 acura rsx thats literally on its last leg. Im living rent free but working towards purchasing my next property. I keep hearing I'm going to have to put down 20-25% on the next one. I wish to purchase another duplex or triplex in a better area with parking. Obviously the price will be much more than my current home. After acquiring a better property in a better location for myself I wish to continue focusing on rental properties. I think I'm doing well for my first property but would like any advice possible if out there. Currently I have 20k saved up and patiently waiting to have enough for my second property. My property also gained 30k worth of equity I noticed so Im not sure if I can tap into that or convert current property to a conventional then just do FHA again on the next property.
Look forward to hearing back for any advice out there in regards to working towards the 2nd property.