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This is the core issue: Buyers have "desired areas," and the more people who desire to live there drives up the price of homes. So if you want to buy a house in an expensive area like LI, you have to make choices: save up "enough," get a roommate, choose a slightly less desirable area, etc.
Smart people will be PATIENT and educate themselves about the process.
Study up on mortgages, real estate and economics in general and continue to save. DO NOT try shortcuts like illegal rentals.
i understand. it's just that i have >$100k saved up, yet i STILL can't do it. i thought my plan sounded good
i understand. it's just that i have >$100k saved up, yet i STILL can't do it. i thought my plan sounded good
Okay, you need to see what a bank will approve you for. A rule of thumb is 3X your income. Of course, your savings can bump up the house you can afford, but not the loan itself. Go from there. The bank won't loan you the money based on income from your boyfriend renting from you, although if he applies with you then you can use his income on the house. Of course, he owns half of it then too.
Also, how do you know that they are all illegal rentals? Another option might be to buy a duplex or triplex if you can afford it and live in one unit.
i understand. it's just that i have >$100k saved up, yet i STILL can't do it. i thought my plan sounded good
It would be less risky and more potentially profitable for you to buy a more affordable condo or coop and live there with your boyfriend paying his share. After two years (when any gain isn't federally taxed) you can decide whether to sell it and roll the proceeds into a new place or rent it out and get a SFH for yourself.
It would help if we knew more about the real estate market in your area.
Also, I've done the rental thing and it was a huge pain in my side and expensive. Some tenants expect everything to be 100% perfect 24/7. Be picky as to who you would rent to.
While I am not a huge fan of every "rule" that Dave Ramsey preaches, he has SOLID advice about buying a home:
Quote:
Buy when you’re financially ready. Here’s how you know you can afford it:
—You’re out of debt.
—You have 3–6 months of expenses in your emergency fund, plus enough cash for a 10–20% down payment on a 15-year fixed mortgage.
—You’re paying cash up front, or your mortgage payment is no more than 25% of your monthly take-home pay.
Jumping into home ownership with debt and no emergency fund is like diving into a pool with no water. You’re sure to hit rock bottom. First the A/C breaks, then the roof leaks. Next thing you know, you’re turning to credit cards and loans to pay for it all—and the hole you’re in just keeps getting bigger.
There’s nothing wrong with renting while you work to get your finances in order.
The OP has NOT shown that they have the FINANCES together at all.
Frankly the BASICS of owning a rental property are EVEN simpler, again I don't agree with everything HGTV Scott McGillivray does but he DOES know what matters MOST:
Quote:
Using cash flow as an indicator to whether a property is a good investment or not helps protect a buyer from being stuck in a scenario where not only is the value not there, they’re actually losing money.” ... “I have properties that aren’t worth what I paid for them in 2006, however, I’m still making money because I calculated the positive cash flow beforehand, knowing they are still paying down the mortgage today.”
You CANNOT count on "illegal apartment" EVER HAVING ANY POSITIVE CASH FLOW!!! Even if you have an tenant who does not care, a nosey neighbor can get you "shut down" by the local authorities!
The OP has no "plan"! #1 --They need to determine if their savings are sufficient to buy a maintain a place! THEN they can go shopping. IF some of the places they can afford are ZONED FOR RENTALS they can decide if the CASH FLOW from renting makes sense to offset the HASSLES of being a landlord.
THAT might be a plan...
Here is a fairly easy to follow outline of how anyone MIGHT consider buying a home that has a rental unit -- if you can't understand the math in this example DO NOT ATTEMPT TO DO THIS!!!
The OP has NOT shown that they have the FINANCES together at all.
Frankly the BASICS of owning a rental property are EVEN simpler, again I don't agree with everything HGTV Scott McGillivray does but he DOES know what matters MOST:
You CANNOT count on "illegal apartment" EVER HAVING ANY POSITIVE CASH FLOW!!! Even if you have an tenant who does not care, a nosey neighbor can get you "shut down" by the local authorities!
The OP has no "plan"! #1 --They need to determine if their savings are sufficient to buy a maintain a place! THEN they can go shopping. IF some of the places they can afford are ZONED FOR RENTALS they can decide if the CASH FLOW from renting makes sense to offset the HASSLES of being a landlord.
THAT might be a plan...
Here is a fairly easy to follow outline of how anyone MIGHT consider buying a home that has a rental unit -- if you can't understand the math in this example DO NOT ATTEMPT TO DO THIS!!!
how can you say the bolded part? i have no debt, i have $125k in the bank in CASH and i make $90k a year. my net income each month is around $3800. how is that not a good position to start thinking of buying a house?!?
i could put 20% down on a $400k house and i would still have $40k in the bank. OR i could i get a cheaper house.
i basically hit every single one of those items you listed.
my point is that ideally i could have minimal monthly expenses if i had rental income from an apartment which would help me to CONTINUE to save and then possibly rent out the house COMPLETELY and buy ANOTHER one.
I admire your drive and there is nothing wrong with wanting to own a home. But pay close attention to the post about the illegal tennant calling the building inspector. The poster also made a point I was thinking too, what if you and your boyfriend break up? With so much money on the line you need to prepare for every possible scenario.
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