Hi everyone! I am new to bigger pockets and I a looking for some advice.
I am looking to purchase my first single family home coming in 2020. I am looking to buy a home around 150k and rent it out.
My biggest fear is having long term vacancy.
I would have the money to pay for the mortgage when nobody is renting, however, I am planning on buying multiple homes in the future and then that won't be an option.
Investor · Springfield , NJ · Member since 2017 · 192 posts · 93 votes
6y
@Nick Delfin
I think we all fear that at first. Once you’ve had a few turnovers and know the drill you get more confident.
My advice is to have at least 3-6 months of operating expense including mortgage in reserves when you start. If that’s not possible then save any extra Cashflow until you do.
Also, you can get more comfortable by analyzing the local market. Invest in a RentRange report which shows you historical vacancy trends. See how long listings last on Zillow. You will probably see the vacancy rate is around 5% or even lower.
Avoid leases that terminate between October and February.
And don’t get desperate and rent to the first applicant. Hold out for the right tenant. It will save you a lot more money than an extra long vacancy.
@Domenick T. Thank you for your thoughts and wisdom! I didn't realize that ending leases between October and February are troublesome. I will look into that.