Live in investment property before renting?

1 Reply

I just moved to a small, rural town a few months ago and am renting a place for 350$ a month. I am planning on buying a small house to live in for at least 6 months and then renting it out, as I am thinking about moving closer to town. There are no rentals here and I think I could rent it out for 750-850/month. The house I have my eyes on is a 2 bdrm, 1 bath, Main St. location, listing price 135k. Might need a few cosmetic updates, flood insurance may apply but I don't know for sure yet.

MY QUESTION: What would be the best strategy for my situation??

1) Buy house, live in it, then rent it when I move away.

2) Buy house, rent it right away and I keep my cheap rental for 350$ month

3) Buy house, but not this one.

4) Not buy a house at all.

Regardless of the questions you asked the property and numbers you describe don't pencil out. 

If you're looking for cash-flow and a stable investment look for deals closer to the 1% rule. If not you'll be injecting cash every month to hold the rental once you move out.