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Old 12-10-2016, 11:29 PM
 
2 posts, read 784 times
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Hi friends, I will take a new job at West Lafayette next year, and am expected to be in this area for a few years. My family will not come with me. Actually we just bought a house in the west coast. Usually I would consider renting a studio or a 1-br apt at W Lafayette, since my stay in this area will be quite short. But when I looked into realty websites like zillow or trulia, I found the price is so cheap, compared to east or west coasts I have lived; and the price-to-rent ratio is very favorable for house purchasing. So I start to think about the possibility of buying an inexpensive house instead of renting. I still have about 30k after closing my recent house purchase; so I can afford another house of 100k-150k at W. Lafayette or Lafayette. If I buy, I can rent it our after I finish my job contract here and return to west coast. But I have no experience in investment properties. I will appreciate if someone can give me some advice. Thanks a lot!
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Old 12-11-2016, 06:17 AM
 
298 posts, read 147,687 times
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Buying a rental property with borrowed money is a money-losing proposition. The question is, do you prefer living in a house? If so, buy one and sell it just before you leave. If you rent it out instead, you will have to hire a property management agency, unless you know a reliable long-term renter already who is guaranteed not to lose his job. Ask a local agency what their fees are and what you can expect to get, net, and compare it to your mortgage payment, plus taxes and insurance. I think you'll find a deficit.
I do know one investor in Indiana who buys and rehabs houses and then rents them, making a good profit. However, he does not borrow money and lives in the same town, supervising his own properties. He also has economies of scale. I think that's necessary to make landlording feasible, even in a college town like Lafayette.
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Old 12-11-2016, 11:42 AM
 
Location: Tennessee
20,958 posts, read 15,285,903 times
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You will still have the mortgage plus you will need to hire a property manager.

I would honestly just rent in your case.
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Old 12-11-2016, 02:09 PM
 
Location: Indianapolis, East Side
691 posts, read 349,583 times
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Quote:
Originally Posted by stayhungry View Post
...But I have no experience in investment properties. I will appreciate if someone can give me some advice. Thanks a lot!
Learning how to be a landlord from 1500 miles away sounds pretty tough. There's a lot that can go wrong with a bad tenant, and if you're out of state, you'll have to pay other people to help you deal with it. If you still want to do this, though, talk to a real estate attorney in Lafayette first to see what your responsibilities as a landlord would be, what the process is to evict a tenant, and worse case, what would happen if someone turned your house into a meth lab.

Personally, I'd rent a small apartment, as you originally planned. Even during the short time you'll be here, a house could need major repairs or replacements, and you'd certainly have a pay a sales commission when you sell it.
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Old 12-11-2016, 02:15 PM
 
Location: Saint John, IN
10,638 posts, read 3,314,105 times
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I agree with the others, it doesn't make sense to buy.
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Old 12-11-2016, 09:27 PM
 
2 posts, read 784 times
Reputation: 10
Thank all you guys. Your inputs are really helpful. I think I will just rent a small apartment, which will give me more flexibility and less headache.
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Old 12-15-2016, 01:35 PM
 
12 posts, read 9,440 times
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Quote:
Originally Posted by stayhungry View Post
Thank all you guys. Your inputs are really helpful. I think I will just rent a small apartment, which will give me more flexibility and less headache.
Plus you could always buy and move out here Permanently if you enjoy it
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