"I don't think enough attention has been paid to your rental property; that's why I focused on it. $1377 covers both mortgages on the property, hopefully tax and insurance, and HOA. Do you really have no other expenses on the property at all? Do tenants pay all utilities including water? You never have any repairs or maintenance at all? Even if this is true, what about the risks if
- tenants move out and you have to cover all costs for a period of time without receiving rent
- any repairs or maintenance costs come up
- interest rates go up... are both mortgages fixed-rate? is one a HELOC? interest-only?"
Thank you for bringing these questions to the forefront.
1. Tenants pay ALL expenses and utilities. Water is part of the HOA fees (for that much, it better be!)
2. Taxes and insurance part of the mortgage payment, so that's covered.
3. We've been renting this unit since 2006. In that timeframe, the longest it has ever stayed vacant is 6 weeks. We've had about 5 tenants. The current tenant has been there 2.5 years and has 1.5 years left on her lease. To date, she's never been late on rent.
4. Both mortgages are fixed. We did a HARP refi a couple of years back.
5. Repairs/maintenance has proved minimal (<$250/year when rented).
Honestly, our tenant has 1.5 years left on her lease, so we'll re-evaluate when she moves out. For now, we write off anything we spend on our tax return.
- tenants move out and you have to cover all costs for a period of time without receiving rent
- any repairs or maintenance costs come up
- interest rates go up... are both mortgages fixed-rate? is one a HELOC? interest-only?"
Thank you for bringing these questions to the forefront.
1. Tenants pay ALL expenses and utilities. Water is part of the HOA fees (for that much, it better be!)
2. Taxes and insurance part of the mortgage payment, so that's covered.
3. We've been renting this unit since 2006. In that timeframe, the longest it has ever stayed vacant is 6 weeks. We've had about 5 tenants. The current tenant has been there 2.5 years and has 1.5 years left on her lease. To date, she's never been late on rent.
4. Both mortgages are fixed. We did a HARP refi a couple of years back.
5. Repairs/maintenance has proved minimal (<$250/year when rented).
Honestly, our tenant has 1.5 years left on her lease, so we'll re-evaluate when she moves out. For now, we write off anything we spend on our tax return.
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