Since the beginning of 2018,  I have had many Boston real estate investors approach me about purchasing a Boston multi-family with two to four units. Some wanted to income property that was fully rented out and others wanted delivered empty.  Finding a Boston property that is fully rented is not hard to find, empty units much more difficult.  The advantage of buying a fully rented property means that much of the cash flow guess work is eliminated for you and you can just judge it based on the math.  At that point the numbers decide for you.  It’s hard to argue with math (ROI).

However, I have also been approached by plenty of potential investors that are also looking for a place to live and figure they can kill two birds with one stone.  At first glance it almost seems like a no brainer to find a four unit property where the rent from the first three units will pay for your living expenses in the fourth unit.  You get to live for free!.

But not so Fast.  See what many potential investment property buyers don’t consider is that if you live in one of your units you are most likely going to face  two major downfalls.  They are:

  • Higher Maintenance Costs:  This one may seem strange at first glance but it is pretty obvious if you spend a minute thinking about it.  Picture yourself living in a rental as you either do now or have in the past.  Now, what would you do if one of your kitchen sink is leaking just a bit?  Nothing major, just a little tiny bit.  I am willing to venture that you would have done one of two things.  Fix it yourself or ignore it.  Now picture the exact same scenario but with your landlord living in the unit right next to yours.  If you are anything like me, you would run into him one day as you were coming home from work and you would ask him to come fix it.  Now multiply that by the number of units the property you are interested in and by the number of little tiny things that would never merit a call to the landlord but may be mentioned during a run in.
  • Sound Annoying? You Bet!  Aside from the financial cost of having to deal with a number of minor details that many tenants would normally fix on their own, you can imagine how annoying a situation like this one may become.  In a worst case scenario, you could start to fear the thought of running into your tenants and you will start to avoid them.  Why put that kind of stress into your life.  A landlord’s job should be to find good people and to collect money, not to deal with every possible detail under the sun.  Now, please do not misunderstand me.  I am not at all suggesting that you should not take great care of your tenants. After all, your property is only as good as the people living inside it.  You should value your tenants very highly.  I am only saying that if you live on site it will lead to people unintentionally abusing the fact that you are located so close to them.  In other words, they would ask you to do what they would have otherwise done for themselves.

Having said that there are also benefits to living in your own Boston multi-family unit or Boston condo investment.

  • You will always know what is going on in the property.
  • Nobody will care for it the way you will, which will result in a healthier property down the road.
  • You get to control who your neighbors are.
  • Great tax benifits
  • Ideal for planning retirement options. future income

If you find yourself in a similar situation just make sure to consider the factors above.  Also, remember that if you do rent out every unit you can always take that money and rent yourself a property elsewhere or pay a mortgage with it

Back to Boston condos for sale homepage

Contact me to find out more about Boston condos for sale or to set up an appointment call/text 617-595-3712.

Boston condos

Boston condos for sale

SEARCH FOR CONDOS FOR SALE AND RENTALS

For more information please contact one of our on-call agents at 617-595-3712.

Updated:  1st Q 2018

 

Comments

comments