Most 1st time homebuyers don't pay much attention to duplex homes or any apartment-style houses in favor of buying a more traditional single-family home. Many real estate agents have never owned a duplex or multi-family home before and I am betting very few approach the idea of buying a multi-family home as a first real estate purchase. Just because buyers aren't asking about duplex listings doesn't mean a duplex or multi-family home wouldn't be a good fit for them. Over the years the buyer's parents loved the idea of a duplex being their childs starter home. The key is understanding the motivation and goals of the buyer because being a landlord isn't for everyone.
You may be asking yourself "Why would I want a duplex or multi-family home instead of buying a single family home as my first home purchase". Here are 5 things you may not have considered when you think about a duplex or multi-family home.
- Your renter or renters will help you make your monthly mortgage payment with the monthly rent that they pay you.
- You may be able to qualify for a higher-value duplex than you would qualify by buying a single-family home because many lenders will give you credit for the rent that a tenant will be paying you (some restrictions apply).
- FHA offers low down payment financing on 1-4 unit homes if the property is owner-occupied. This can create an opportunity of buying a nicer and higher-valued property and only need a 3.5% down payment when the home qualifies for FHA financing.
- Your accountant should be able to help you take advantage of special tax advantages when you buy a rental property. Examples include being able to deduct depreciation, deduct maintenance, deduct certain improvements and in many cases, you are writing off these expenses and taking tax deductions while the property is appreciating in value.
- If you can afford to make the entire mortgage payment yourself, you can take the monthly rental income and apply it towards your principal balance on your mortgage and accelerate your loan MUCH faster and build equity so much faster than you could if you were living in a single-family home and absorbing the entire monthly payment by yourself.
It is important to understand that being a landlord isn't for everyone. If it isn't for you, you can always choose to buy a single-family home. However, if you love the idea of buying a home and having it paid off in 10 to 15 years instead of a traditional 30 year approach...then you may want to look into buying a multi-family home as your first home purchase.
Everyone lives somewhere!
The Sam Miller Team REMAX Stars Realty 710 South Main Street Mount Vernon, Ohio 43050 740-397-7800 office http://www.SamMillerSells.com
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