Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 16%
$32.50 /mo
$390 billed annualy
MONTHLY
$39 /mo
billed monthly
7 day free trial. Cancel anytime
Real Estate Deal Analysis & Advice
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 9 years ago on . Most recent reply

User Stats

4
Posts
0
Votes
Sandra Diaz
  • Brooklyn, NY
0
Votes |
4
Posts

first-time home buyer

Sandra Diaz
  • Brooklyn, NY
Posted

Hi All,

I've listened to several bigger pocket podcast and love them!  

I'm considering purchasing a two family house in Cypress Hill's area in Brooklyn, NY 11208 and am planning to rent one apartment We are approved for an FHA loan with 3.5% down however it includes an Upfront mortgage insurance and a monthly PMI so the APR will be 4.6%. Don't know what the APR will be without these fees but the interest is 3.75%. We can possibly come up with 15%-20% down to avoid these charges by borrowing money from my 401K this way I pay interest to myself instead of someone else. The house is $480k but after 30 year fixed interest interest/fees, it would be $800K plus. The house is fully renovated in move in condition. Would this be a good investment? Any advise would be greatly appreciated. Please feel free to ask questions.

Thank you.

Sandra

First-time home buyer.

Most Popular Reply

User Stats

1,870
Posts
777
Votes
Aaron Montague
  • Rental Property Investor
  • Brookline, MA
777
Votes |
1,870
Posts
Aaron Montague
  • Rental Property Investor
  • Brookline, MA
Replied

@Sandra Diaz

There are 2 ways of looking at this purchase, well 100s, but 2 simple ones, rentability or appreciation.

Rentability could be 2 stages: house hacking and then full "investment property"

The basic principal behind house hacking is to drive your monthly housing costs as low as possible.  How much rent will the other side bring in?

Your mortgage will be about $2400. Insurance is probably another $150/month. How much are your taxes? Those will combine into the PITI payment. Principle, Interest, Taxes and Insurance.

As any home owner should, you'll also need to put away some money for future repairs.  Eventually you'll need to replace hot water heaters, roofs and furnaces.  This pot of money is called Cap Ex.  Capital Expenditures are all the major items that eventually break.

If you think about turning this into a full scale investment property you need to consider several things.  You need to add up ALL of your expenses and subtract them from probable rents.

Loading replies...