Anyone own a 2 or 3 family house and live in it as well?

[ehh]

My gf and I have begun the process of buying our first piece of property. We really do not want to a buy a condo and most of the cheaper starter homes are in crappy areas of CT.

We currently live on the first floor of a three-family home. The landlords are extremely nice (a married couple only 5-6 years older than us) so we plan on talking to them a decent amount about this as well since we basically want to follow their path.

Our plans are to buy a two or three family home, live there and rent out the other unit(s) to help pay for the mortgage and then keep it long-term as an investment property. Our current landlords did the same thing (they actually lived in the same unit we are in for fours years) with two houses across the street from each other. They just bought a $600,000 home and take in almost $8k per month from their two rental properties. They paid $120k and $170k for the two houses in '03 and both are already paid off so they are raking in the $ right now for doing next to nothing.

We would buy a home in the same neighborhood we live in now, which is close to Central CT State so students would probably be the main target tenants and a majority of the students live off-campus so it should not be a big problem to find tenants.

My biggest concern is obviously the financial side of things; if we cannot find tenants, if something big goes in the house and we don't have the money to fix it, etc. All of the houses are looking at were built in the 1920's or earlier. We will be on a tight budget without a lot of room for error. There is a good amount of risk but there is also a very nice return in the future, having an extra $4k in income each month would be outstanding down the line.

Does anyone have an stories/advice/personal experience with this sort of thing?

[muggins]

Re: Anyone own a 2 or 3 family house and live in it as well?

My biggest concern is obviously the financial side of things; if we cannot find tenants, if something big goes in the house and we don't have the money to fix it, etc. All of the houses are looking at were built in the 1920's or earlier. We will be on a tight budget without a lot of room for error.

The current market for houses is really awesome where I live (Michigan). I'm guessing it is pretty good in Connecticut too. It is hard to go wrong buying a foreclosed home that was built recently. Buying a very old home without the cash to renovate or fix stuff as the market is right now just doesn't seem like a smart move. That and you have to share your walls with people, you have to go through all the process of being a landlord etc. Just doesn't seem worth it when there are so many houses out there right now for cheap. Take the money you would've used buying that huge house, put it in an investment fund.

[mjb2124]

Re: Anyone own a 2 or 3 family house and live in it as well?

Buying a very old home without the cash to renovate or fix stuff as the market is right now just doesn't seem like a smart move.

That's what I was thinking. Everything sounds good on the surface, but if you're the landlord, you'll be responsible for any problems the house has. An older home is likely to have some issues and possibly some serious issues. What would you do if the roof leaked and you needed to replace the roof or any structural issue? Plumbing and electrical are also things that often need fixed in an older home. Older homes are known for mix and match electrical wiring which can sometimes be a hazard. I would just make sure you have enough money to handle any issues that could arise.

[ehh]

Re: Anyone own a 2 or 3 family house and live in it as well?

That's what I was thinking. Everything sounds good on the surface, but if you're the landlord, you'll be responsible for any problems the house has. An older home is likely to have some issues and possibly some serious issues. What would you do if the roof leaked and you needed to replace the roof or any structural issue? Plumbing and electrical are also things that often need fixed in an older home. Older homes are known for mix and match electrical wiring which can sometimes be a hazard. I would just make sure you have enough money to handle any issues that could arise.

That was one of the questions I already asked our current landlord and he said the inspection before they bought the house took care of concerns like that for the most part. It's still a very big concern for me because an inspector doesn't have a crystal ball - sure, something may be fine when he's looking at it but a month later it could need major repair.

[ESPNdeportes]

Re: Anyone own a 2 or 3 family house and live in it as well?

I'm sure you've heard it, but be careful before you commit to buying a property with your GF. That has the potential for big time headaches if you guys split. And, if you're buying a multi-family property, and can't rent it out and cover the mortgage, it could get pretty hairy.

If both your names are on the mortgage and title, and break up, thats bad news. If its just yours, and you break up, then you're solely responsible for the payments and you could find yourself in over your head.