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Hello,
I recently moved to Arlington, VA (very high cost of living) from Virginia Beach (modest / low cost of living). I bought a house in Virginia Beach for 439k and it currently is rented out and is covering all expenses (mortgage, upkeep, PM fees etc.) and is pulling a small profit. So that house assuming everything stays the same - essentially runs itself.
I moved up to Arlington for my job (same one, just less travel since I'm in the area closer to the companies I supported). I decided it was best to rent since I didn't know exactly what kind of lifestyle I wanted (26 years old, careers change, girlfriend etc.) The rent is currently $2800 a month all inclusive for a 1 bdr/bath + a den.
To purchase a similar property in this area it would be around 600k (2 bedrooms, 1/2 baths, 1000 sq feet). This would require a significant down payment.
I feel like I have to three choices:
A) Buy a property in Arlington although I'm not sure how long I will live here and turn it into a rental once I move. If I do this I will pay less interest (primary residence) and I'll be able to write off the Interest on my taxes.
B) Take the down payment I would pay and buy a more reasonable house in Virginia Beach (250K can get you the same property here and only put 50k down / 20% down and turn it into a rental immediately). I would then rent in Arlington again around the same rate.
C) Simply continue to rent my property in VB, take the money I would put on a down payment and invest it. Continue to rent in Arlington.
Option B seems like the best since I'd be investing in real estate, I tie less money into the down payment and giving me more flexibility if we want to move. The downside of it is that I'm paying very high rent for where I live when I could be investing that money per month into a property.
I'd love to get your thoughts! It's kind of strange to buy rental property and rent personally but it seems like a good option here. Keeping in mind most mortgages are mostly interest anyway so rent isn't completely throwing money away (since I get something in return ~ a place to live without any risk).
I recently moved to Arlington, VA (very high cost of living) from Virginia Beach (modest / low cost of living). I bought a house in Virginia Beach for 439k and it currently is rented out and is covering all expenses (mortgage, upkeep, PM fees etc.) and is pulling a small profit. So that house assuming everything stays the same - essentially runs itself.
I moved up to Arlington for my job (same one, just less travel since I'm in the area closer to the companies I supported). I decided it was best to rent since I didn't know exactly what kind of lifestyle I wanted (26 years old, careers change, girlfriend etc.) The rent is currently $2800 a month all inclusive for a 1 bdr/bath + a den.
To purchase a similar property in this area it would be around 600k (2 bedrooms, 1/2 baths, 1000 sq feet). This would require a significant down payment.
I feel like I have to three choices:
A) Buy a property in Arlington although I'm not sure how long I will live here and turn it into a rental once I move. If I do this I will pay less interest (primary residence) and I'll be able to write off the Interest on my taxes.
B) Take the down payment I would pay and buy a more reasonable house in Virginia Beach (250K can get you the same property here and only put 50k down / 20% down and turn it into a rental immediately). I would then rent in Arlington again around the same rate.
C) Simply continue to rent my property in VB, take the money I would put on a down payment and invest it. Continue to rent in Arlington.
Option B seems like the best since I'd be investing in real estate, I tie less money into the down payment and giving me more flexibility if we want to move. The downside of it is that I'm paying very high rent for where I live when I could be investing that money per month into a property.
I'd love to get your thoughts! It's kind of strange to buy rental property and rent personally but it seems like a good option here. Keeping in mind most mortgages are mostly interest anyway so rent isn't completely throwing money away (since I get something in return ~ a place to live without any risk).
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