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I don't get how a house can be an investment when you live there. Maybe if you are single and you rent out rooms or if you buy properties and rent them out, but roommates?
I mean once you have kids will you really want people coming into your house at any hours of the night and day and waking them? Will they want to live with a crying baby 24/7 from colic or night terrors? Will they want to be asked to not bring over strangers they meet in a bar because you are nervous about those people? Do you want those people wandering in your house with your children sleeping in their rooms? What if they kill, molest, or abduct?
I would rather rent a smaller apartment with just my husband and daughter than risk her or our safety for a couple of bucks. If I were single? Maybe but qualifying for a mortgage for a 4 bedroom house where I live is over $800k minimum. Most 3 bd run $750k so that's a hefty salary I need to qualify for the mortgage solo and I don't think they consider rental income.
Same thing with buying a duplex. 2 family rentals where I live are expensive considering my townhouse was $600k and my neighbors paid the same. I would consider living in a 2 family or duplex, but I know my DH and I couldn't have afforded the DP and nest egg to finance such a deal. We would never have gotten approved for the mortgage, nor could we finance the entire mortgage if we didn't have renters or something happened.
Now that's not to say being a landlord isn't lucrative. I follow a very interesting blog about a 27 year old women in TX who owns 5 properties and is a landlord and is "millionaire". But she walked out of college with a trust fund and her parents/grandparents have financed her mortgages and down payments, paid for college 100%, and given her annual maximum cash gifts of like $25k to help finance retirement and minimize taxes on their estates.
I don't have that sort of safety net, nor do I have that sort of background to make investing in real estate a reality. I never will. But money breeds money. People with money are able to finance their kids to a better start in life, it's just a fact. They walk out of college debt free, trust funds, often first cars paid for, house down payment, wedding paid for, etc.
And no it doesn't make them a bad person but it does make life easier. And so investing in things like real estate is a "cinch" because you don't have to save a down payment, you don't have to worry about a cash cushion in case you don't have renters.
By the way her rentals last year i think were $11k negative from lack of tenants. She writes very honest posts about her tenants and problems. No hiding the reality and I appreciate her candor. She explains how risky and how difficult it can be to get phone calls at 2 am. And sometimes she wants to not answer her cell phone. I think people pretend it's easy but people who tell the absolute truth will say that there is no such thing as easy money AND it's easier when you have lots of cash.
I mean once you have kids will you really want people coming into your house at any hours of the night and day and waking them? Will they want to live with a crying baby 24/7 from colic or night terrors? Will they want to be asked to not bring over strangers they meet in a bar because you are nervous about those people? Do you want those people wandering in your house with your children sleeping in their rooms? What if they kill, molest, or abduct?
I would rather rent a smaller apartment with just my husband and daughter than risk her or our safety for a couple of bucks. If I were single? Maybe but qualifying for a mortgage for a 4 bedroom house where I live is over $800k minimum. Most 3 bd run $750k so that's a hefty salary I need to qualify for the mortgage solo and I don't think they consider rental income.
Same thing with buying a duplex. 2 family rentals where I live are expensive considering my townhouse was $600k and my neighbors paid the same. I would consider living in a 2 family or duplex, but I know my DH and I couldn't have afforded the DP and nest egg to finance such a deal. We would never have gotten approved for the mortgage, nor could we finance the entire mortgage if we didn't have renters or something happened.
Now that's not to say being a landlord isn't lucrative. I follow a very interesting blog about a 27 year old women in TX who owns 5 properties and is a landlord and is "millionaire". But she walked out of college with a trust fund and her parents/grandparents have financed her mortgages and down payments, paid for college 100%, and given her annual maximum cash gifts of like $25k to help finance retirement and minimize taxes on their estates.
I don't have that sort of safety net, nor do I have that sort of background to make investing in real estate a reality. I never will. But money breeds money. People with money are able to finance their kids to a better start in life, it's just a fact. They walk out of college debt free, trust funds, often first cars paid for, house down payment, wedding paid for, etc.
And no it doesn't make them a bad person but it does make life easier. And so investing in things like real estate is a "cinch" because you don't have to save a down payment, you don't have to worry about a cash cushion in case you don't have renters.
By the way her rentals last year i think were $11k negative from lack of tenants. She writes very honest posts about her tenants and problems. No hiding the reality and I appreciate her candor. She explains how risky and how difficult it can be to get phone calls at 2 am. And sometimes she wants to not answer her cell phone. I think people pretend it's easy but people who tell the absolute truth will say that there is no such thing as easy money AND it's easier when you have lots of cash.
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