I want to get into buying houses and renting them out. Where do I start?

Tips and Deals Forums Buying Your Home I want to get into buying houses and renting them out. Where do I start?

This topic contains 7 replies, has 6 voices, and was last updated by  Anonymous 8 years, 2 months ago.

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  • #208256

    Anonymous

    I am a college student and wanted to get into buying houses and renting them out. To be exact I want to start small and buy a house in my college town and rent it out to students. Where do I start my research and learning? Any good books to read? Any advice will help and is much appreciated! Thanks in advance

  • #265881

    Anonymous

    This is best time to invest in real estate market as every where in the world real estate market is felling heat.Go through the real estate related sites and start looking for good option over there.

  • #268182

    Anonymous

    go to real estate school

  • #273385

    Anonymous

    There’s a good book simply called “Landlording”

    One of the first thing you’ll learn is that being a landlord is like public relations. Need to be a good judge of people in order to choose good tenants.

    If you’re going to be in the business, get a real estate license and learn as much as you can as fast as you can. You can learn on the job, but it will cost you more than tuition.

  • #283006

    Anonymous

    Figure out the cash flows so you know what you can afford. Be conservative in the amount of money that you will need to put down, as well as your interest rate. I would finance over 30 years, so that you have the lowest amount of debt to cover. While a shorter amortization will result in you paying less interest, the primary concern is being able to cover the payments. That’s easiest with the lowest possible payment. Be sure that you factor into the payment your real estate taxes. Add an extra 1% to the interest rate. Also add in repair and maintenance costs, as you will likely buy something older that your renters could very well destroy (college kids seem to have a tendency for this).

    Apply for an FHA loan. That is for first time home buyers and has a good financing program, but I am not sure whether the program allows renters. Call up a bank and ask for a mortgage specialist so you can find out, and they will give you some more numbers to work with. You will have to know how much the bank is willing to fund, unless you have the cash to buy the whole thing up front.

    Next, compare the rent that you would need to charge to cover your costs on the loan, taxes, maintenance and insurance. Compare this to local rents to see if it is competitive. If it is not competitive, then don’t buy the house. Chances are that it will go down in value anyways, in the current environment.

    You will also need to talk to an accountant to find out how to set up a system to track everything. You might even want to try to schedule a meeting with an accounting or finance professor at your university to find out about this. I recall that my university had a finance class for real estate investments.

    There are all sorts of online sources for real estate. Go to Borders or Barnes and Noble to see actual books. There are probably some informative Real Estate Investing for Dummies boooks. Don’t count them out due to the titles.

    And when you go to buy a place, the best buys are the places that just need some cosmetic improvements, but are fine with respect to structure and systems. They are cheaper because they don’t show well, but paint and other cleanup can do wonders. Get a home inspector to look it over before buying though, and use the inspection report to negotiate the price down by saying, “it costs $6,000 to get a new AC unit and associated HVAC stuff, so give me $6,000 at closing”. Home inspectors cost about $500 or so.

  • #439342

    Anonymous

    If they have decent credit and have been paying their mortgage on time, they should still qualify for a good rate.

    First-time home-buyer programs aren’t all they’re cracked up to be.

  • #439343

    Anonymous

    not really anything they can do if they decide to sell. they would have to accept their losses and move on. if they have maintained their good credit, they should still be able to qualify for a good rate on a new loan.

  • #439344

    Anonymous

    No, they didn’t get any special discount because they are first time homebuyers–even if they think they did.

    Just FYI, mortgage companies consider anyone who hasn’t own a home in over three years the same as a first time homebuyer.

    Rick Lanicek
    http://www.primelendingonline.com

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