Wednesday, April 21, 2010

Tenant paying your mortgage? Is it possible again?

Picture of the "Gingerbread House" i...Image via Wikipedia
AP just did a week-long study of major real-estate markets, and they are pinpointed a lot of markets where it is cheaper to OWN a home instead of renting one. While this is usually good news to the renters (who want to become owners), it is also a golden opportunity for those who have the down payment available to pay down house, and get a tenant to pay the mortgage for you.

This is that Robert "Rich Dad" Kiyosaki promotes in his books and his Cashflow game: find a property with "net positive cashflow", and according to the AP study, some markets have rent HIGHER than that of mortgage (esp. in foreclosure-ravaged areas), and that is without counting any special benefits like tax credits and such that only owners can benefit from.

If you currently rent, it is a great time to buy, esp. in those markets. Even if you already own your home, you may want to look into what credits and loans you can get for investment property (non-owner-occupied) and if you can generate any positive cashflow from it. When the home prices go back up in a few years, you will be raking in money... maybe.
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