Keep Your First House
By obPrimr in Real Estate | 4 comments
The guy who owns the property where I keep my horse is always talking about how he is “house rich, cash poor.” He owns several different houses — at least three, I think — living in one and renting out the rest.
He frequently tells me about how his dad always said you should keep your first house. When you move into an upgrade, you can rent it out to continue paying the mortgage, and continue to build equity. That way, when you finally sell it you’ll make a profit.
Keeping your first house also enables you continue making upgrades to the property that will increase the value and therefore also help you to build equity in the house. For instance, putting in things like outdoor sinks, built in grills, bathroom and kitchen upgrades, etc. will add to the value of the home, not to mention its appeal to potential buyers. Making these upgrades while you live there will of course give you a chance to enjoy them, but even if you make the upgrades after you move out, you’ll still benefit by being able to charge a higher rent.
Theoretically, he’s right — keeping your first house is a great investment, IF you are up to the challenge of being a landlord. I personally wouldn’t want to do it though. There are a lot of responsibilities and risks involved with being a landlord, so it’s not like it’s an easy investment opportunity!
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Kyla | Jun 1, 2009 | Reply
Wow, thanks for the information! That’s a great way to keep income coming, especially during these times.
Great post!
Aimee | Jun 6, 2009 | Reply
Great post!
Yes, a house is still an investment and we always have to think about maintaining and upgrading it especially if we’re thinking of selling it eventually.
Good luck with your upgrades!
Abby | Jun 12, 2009 | Reply
I think that’s a harder job, being a landlord. Personally, I never want to be a landlord. But, in these times, we have to be realistic and I may find myself in that position.
Billie | Jun 12, 2009 | Reply
Whenever I think about upgrading something in my house, it’s because I want it to add more value to my house when I sell it. I never really thought about renting it out. Maybe I’ll do that, too. Thanks!