Note, it is a great idea to buy/invest in real estate. I love to work with young first time buyers especially in their 20’s that have the foresight to purchase something today with rates so low and prices having been redefined.
A great example is the ability to purchase say a two-family home. One can do it with FHA financing with as little as 3.5% down and have seller pay the closing costs. As such you may pick up a home for $400,000 spending as little as $14,000 if seller agrees to pick up all the closing fees (effectively netting the seller around $385,000).
In this scenario if rental income on the 2nd unit is $1,600/month (rents continue to increase in excess of real estate appreciation) and real estate taxes roughly $12,000/year, a 30 year fixed rate FHA mortgage of 3.75%, our buyer can expect to have a total monthly payment of approximately $3,242.
After taking into consideration the rental income on the subject (we use 75% of leased or market rent-whichever is lower), our borrower needs to earn around $85,000/year with debt not in excess of $1,230/month OR can make as little as $75,000/year if debt is no more than $780/month.
Get in, learn how to manage your home, your tenant and before long you can be purchasing your second home and keep this one as an investment property. You’ve just increased net worth potentially by $1M in the long term.
AS I ALWAYS SAY, HOMEOWNERSHIP, IT’S A DREAM WORTH PURSUING!!