All Forum Posts by: Pamela Sandberg

Check your local city codes and zoning ordinances! Municipalities can limit the number of unrelated people who live in a single property, and there could be other restrictions that will affect your rentals. 

Also: fully agreed on the college students! That is probably your best market for renting by the room, so stick with properties close to the campuses. 

This article discusses a LOT of important exclusions. There are many types of damage (or damage resulting from poor workmanship) that would NOT be covered by homeowner's insurance. It's a risky bet to rely on homeowner's insurance to cover a contractor's mistake. And even if it did, you would be stuck with higher premiums for something your contractor did.

Small multis (2-4 doors) are really hard to come by here, and yes, a lot of them are in less desirable neighborhoods. try running the numbers on some single family properties, just to see how they compare. We are a little tight on cash flow right now, but our rents raise reliably every year, and the appreciation is amazing! 

One other thought: there are some properties out there with casitas/in law suites/etc. This might be a good way to rent out two units on a single property. 

Their insurance isn't just for premises liability. It also covers damage that they do to your property (which is arguably more likely if the contractor doesn't have insurance). 

House hacking is a fantastic option, especially for students! I will warn you that MF inventory around ASU is really, really, really limited. You might consider getting a large SFH with several rooms that you can rent out to cover the mortgage.

Happy to answer any questions about Tempe/Phoenix, strategy, financing, etc.!

Cash flow is a little tight in Phoenix right now, but our appreciation has been awesome! If, for example, you spread your $200k into a couple of down payments on SFH here, you could have a couple of properties that would be worth a lot more after a year or two of renting them out. (Your cash flow might be a little light during that time, but you'd still be on the positive side.) Then, if you sold or refinanced, your initial $200k could be worth a lot more once your properties have appreciated.

Happy to discuss strategies or answer any questions about the Phoenix market!

Are you looking for cash flow or appreciation? 

They definitely exist! Sometime you have to hunt for them, but they're out there. You also have to be careful of the zoning. They aren't technically allow on a property that's only zoned for single family. The City of Phoenix hasn't enforced this (yet), but that day could be coming. 

If you like, I can send you some sample properties on the market with ADUs just so you can run the numbers. It's worked out really well for a lot of owners. 

Also, be sure to check the terms of your FHA loan. They may not allow you to rent it out if the loan is ONLY for a primary residence. Check with your lender just to be sure you know about any potential complications.

A method you might consider is a property with a casita/in law suite/etc. You can rent our the unit, but still maintain privacy in the main house for your family. This is also a good way to learn how to deal with landlord issues.