Comments on: Home Sweet Rental Property

By: Mom

Mom — Wed, 22 Aug 2007 19:12:31 +0000

Uh, yea…… no surprise there….

By: Mer

Mer — Tue, 21 Aug 2007 19:53:38 +0000

@ Mom: Eh, I think it’s just more proof that you like her best.

By: Mom

Mom — Tue, 21 Aug 2007 19:37:57 +0000

Hi again,
I really have to stop reading your posts now and get some work done. Then again, you are going to be a real estate mogul and support me in my old age.
Both ideas have merit. And you will use both ideas depending on the property, interest rates, property values in the area and many more considerations.
You know I am in favor of reducing mortgage debt as fast as possible to build equity and therefore security. But most of the time, if you are going to be purchasing other properties, and the rent covers the monthly costs with some to spare, I would keep that money liquid and not bang on the mortgage until you have a substantial amount in a separate account for that particular property. Sorry, Mer, Dani is right on this one. You need the cushion for a new roof, heater, windows, whatever. Then, once that cushion is established you can start saving for the next downpayment. Mortgage rates are not always going to be favorable, when they are take advantage and refi cash out of your properties to buy others. If you want to own more properties, you need the liquidity for down payments, deposits and repairs.
Mom

By: Mer

Mer — Mon, 06 Aug 2007 18:43:18 +0000

@ Jen: Honestly, any market is risky, and the only reliable method of moderating that risk is knowledge. I grew up the daughter of a real estate agent/mortgage broker/property manager/title insurance agent, so I have a grasp on the vocabulary of the market and small built-in list of resources that the average civilian won’t, so real estate is probably a good market for me. My cousins, on the other hand, are being raised by an executive accountant and a SVP of Something Expensive at Solomon Smith Barney. They are very much not likely to know from real estate, but I’ll bet you they have a great native understanding of bonds and mutual funds.

It’s all in what you know, and if you don’t know nothin’, it’s what you choose to learn. *shrug* But thanks for the luck, we’re gunna need it!

By: Jen T.

Jen T. — Mon, 06 Aug 2007 17:05:22 +0000

Honestly, both proposals scare me to death. I cannot imagine being a landlord, and having to deal with people who trash your property and then the legal battles over getting paid for repairs. Nor can I imagine the risk of buying/flipping/selling for profit. I have always viewed “real estate” as a risky market, and one I get involved in only long enough to find myself a home. I’ve done that, and don’t ever plan on getting into it again.
So my comment is: Kudos to you for your bravery, and I wish you the best of good luck in your endeavours, whichever way you choose!