My parents are renting a one bedroom apartment and they pay $1500 a month. Is it a good idea to buy one and rent it out to them? $165,000 with condo fee 479. Am not expecting profit here. Your advice and suggestions are highly appreciated. Thanks.
Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
7y
Are you going to rent it to them at $1500? If so then you will cashflow a little bit depending on how much you put down. Let's say you rent it to them at your cost. You still get the depreciation and appreciation and amortization aspects of real estate. Seems like a no brainer to me.
You would have to run the numbers on opportunity cost though. Can you invest the capital and then subsidize their rent with the profit etc etc etc.
Rental Property Investor · Chandler AZ and Sylvania, OH · Member since 2009 · 708 posts · 561 votes
7y
Are you going to rent it to them at $1500? If so then you will cashflow a little bit depending on how much you put down. Let's say you rent it to them at your cost. You still get the depreciation and appreciation and amortization aspects of real estate. Seems like a no brainer to me.
You would have to run the numbers on opportunity cost though. Can you invest the capital and then subsidize their rent with the profit etc etc etc.
Real Estate Agent · Scottsdale, AZ · Member since 2011 · 471 posts · 296 votes
7y
@Arsiema Berhane Condominiums don't usually appreciate as much as SFR and the HOA dues almost always continue to increase while property values can decrease.
Check the stats to make sure it's a good investment!
I will rent it to them for $1350. I will cover some of the expenses, so I will not be making money from them. But I just wondered if it's a good idea, since they won't move from the area and will always be renting, so why not rent from me:)
@Arsiema Berhane Condominiums don't usually appreciate as much as SFR and the HOA dues almost always continue to increase while property values can decrease.
Check the stats to make sure it's a good investment!
Good luck!
Amazon HQ is coming to our area (DMV) and condos are flying like anything. I thought I might be able to sell it one day when the time comes, but right now since my folks have no interest moving from the area and will always be renting, I thought why not. This is my first purchase btw. Never owned a home.
Are you going to rent it to them at $1500? If so then you will cashflow a little bit depending on how much you put down. Let's say you rent it to them at your cost. You still get the depreciation and appreciation and amortization aspects of real estate. Seems like a no brainer to me.
You would have to run the numbers on opportunity cost though. Can you invest the capital and then subsidize their rent with the profit etc etc etc.
I will rent it to them for $1350. I will cover some of the expenses, so I will not be making money from them. But I just wondered if it's a good idea, since they won't move from the area and will always be renting, so why not rent from me:)
Alexandria, VA · Member since 2017 · 10 posts · 4 votes
7y
@Arsiema Berhane - where is the property located? If its in Arlington or Alexandria VA you will likely see a nice return in the future as " Arlington Home Prices Will Spike 17.2 Percent by the End of 2019." Here is an article with a bit more info,
@Arsiema Berhane - where is the property located? If its in Arlington or Alexandria VA you will likely see a nice return in the future as " Arlington Home Prices Will Spike 17.2 Percent by the End of 2019." Here is an article with a bit more info,
Real Estate Broker · Los Angeles, CA · Member since 2017 · 655 posts · 293 votes
7y
I would do it, even if the rental amount you set just covers the PITI. You have to pay to live somewhere, might as well pay yourself and get the tax benefits.
HOA is tax deductible when used as an investment property. Just read the HOA Bylaws and make sure you can rent it out - even to your own parents
Real Estate Agent · Palm Springs, CA · Member since 2016 · 81 posts · 112 votes
7y
I think that what you're thinking of doing for your parents is wonderful. If you collect enough from them to cover expenses it's beautiful. If you can only get PITI, that's still beautiful. They're your parents after all. Very sweet of you.