I want to make my primary home into a rental and buy another primary and start investing in that way
How long do I have my renters sign a lease for minimum and maximum
Hey @Jose Huijon ! Does your primary home cash flow well?
I'd sign a tenant to a 1-2 yr lease!
No. I live in it right now but wanting to rent it out and get another home
@Jose Huijon I mean, would it cash flow well as a rental property?
Yes about $300
Hi @Jose Huijon , Thats exactly how I started as well!
I would also make sure that you run your numbers for your budgets on Cap Ex, Maintenance, Vacancy, and Property management (even if you will self manage yourself) just to ensure your house will cash flow positive. Depending on the age and state of the current house will determine how much you should likely budget.
I myself budget about 3% for vacancy, 6% Cap ex and Maintenance, and 10% property management (which I keep myself since I self manage) But these budget figures are for my own property, and may or may not work with yours.
Best of luck!
@Alexander Lang thank you very much for your input.
My home has HOA do I include that in the payment?
Yeah I would include that as if it was another item to budget for. A very rough example below
A basic Example:
Rent: + $1000/month
Mortgage/insurance/tax: - $500/month
HOA: - $100
Vacancy, CAP EX, Maintenance, Property management: - $100
$1000 (rent) - $700 (budget/expenses) = $300 cash flow
That is nice if you have an HOA as those often do cover large exterior items like Roofs, driveways, siding, etc... That should lower your budget to save for those CAP EX items greatly.