Source
r/personalfinance•
Computersoverconsole

Duplex sounds nice at this point.

Other

So I’ve been here like 3 times and have gotten great advice every time so I’d like to thank everyone here for that. :) So I’ve come to the conclusion that I’m going to shell out the $300 every month for a train pass from AC to philly for my 5 years of apprenticing. I do still want to get into real estate though, I’ve been researching possible things to buy to rent out. At this point, a sub 200k duplex in Philly looks like a nice option. I’d like to just rent out both units and pay off the mortgage insanely fast by adding any extra money(which will be about 1-2k per month) towards it. Does this seem reasonable? Should I just hold off on throwing extra money at it and save for down payment on another property? Edit: just to clarify, I’m spending the $300 so I can live rent+ utility free with my mom. :)

Posted Mar 8, 2019, 6:09 PM UTC

05
InteriorAttack•

it comes down to being ready to be a land lord. are you ready for gaps in renters (and ones that trash the place) and can cover the mortgage easily

2
benicebitch•
  • You need more money down than normal for a property that won't be your primary residence.
  • Managing a property yourself from some distance can be very difficult
  • It is costly to pay a management company to do it
  • If you don't have a really nice down payment, breaking even may be difficult in this market
  • You need a much larger emergency fund. You can have both tenants trash the place and move out at the same time and you've got to replace all the carpet and paint both units in the same month, as well as pay an attorney to try to recover some of the cost (which you won't get because deadbeats don't have anything to get)

​

This is a good idea if:

  • You have a good down payment
  • You can do a lot of repairs yourself
  • You live close by to check out all the things your tenants complain about
  • You have a huge ass emergency fund
  • You can afford for it to sit vacant for 1/2 of the year
2
ComputersoverconsoleOP•

Ok so I’m going to be a union electrician. So that covers a couple repairs, I start at $22 an hour and will be making $58 an hour after the 5 year program with a $1.5 An hour raise every year after. I currently have about $10000 in my savings and will be working as an electricians helper making $18 until September when I start the apprenticeship. I’m only 17 (turn 18 in September) right now so I considering my have basically no bills I can save like 80% of my income. I’ll be working in philly daily so I’ll be close by after like 3 everyday if anything arises. Sorry for the info dump I’m just trying to materialize and plan for my future.

1
benicebitch•

You don't have anywhere near enough money to buy a 200k duplex as a rental property, and I'm pretty sure you can't buy a house if you aren't 18 yet.

1
ComputersoverconsoleOP•

This isn't something i want to do tomorrow, i should have specified, my bad. I'm looking to buy this when I'm like 19 or 20 after saving ab 80% of my income for the 2 years. If all goes according to plan i should have about 60k cash by then.

1