California Real Estate Hack with Multi-Unit Properties
In the world of real estate, there are various investment strategies to consider. If you haven’t noticed, it’s becoming harder for first time homebuyers to start building equity in California as the housing prices have risen. While many people aspire to own their dream home, there's another avenue that holds great potential: multi-unit properties. Let’s delve into the advantages of purchasing a duplex, triplex, or fourplex using an FHA loan with as little as 3.5% down! Not only does this enable you to purchase a primary residence, but it also presents an opportunity to generate rental income and build home equity. Let's explore this path to homeownership and investment simultaneously.
Low down payment with an FHA Loan: Typically, investment properties require at least 20-25% for a down payment, but if you live in one of the units, with an FHA loan, you can secure financing with a down payment as low as 3.5%. The reduced down payment makes it easier to enter the real estate market and start building equity.
Rental Income to Offset Expenses: The beauty of owning a multi-unit property lies in the potential rental income it can generate. By residing in one unit and renting out the remaining units, you essentially become the landlord of your own property. The rental income from the additional units can help cover a significant portion, if not all, of your monthly expenses, such as mortgage payments, property taxes, insurance, and maintenance costs. This arrangement allows you to live comfortably while simultaneously reaping the benefits of real estate investment.
Accelerated Home Equity Growth: As you make mortgage payments over time, your home equity gradually increases. With a multi-unit property, not only are you building equity through the appreciation of the property but also the rental income that adds to your net worth. This dual approach offers an excellent opportunity to build wealth and establish a strong financial foundation for the future.
Purchasing a multi-unit property as a primary residence provides an amazing opportunity to homeownership and real estate investment! I have a triplex unit listing coming on the market soon in Old Roseville that currently has two units occupied and one vacant - perfect for this investment strategy! Reach out if you know of anyone that would be interested in starting or continuing their real estate portfolio in this way!
Disclaimer: The information provided is for general informational purposes only and should not be considered as financial or investment advice.