JohnGalt
Distinguished Member
- Joined
- Feb 27, 2009
- Messages
- 4,910
- Reaction score
- 780
Well if you can find somewhere else to live then you'll be making $500 a month spending money.Originally Posted by Blackhood
The usual equation is: can I afford the Bills (mortgage/utilities) for 6 months when both my tenants run away without paying? If so, you're in a good place to keep a second property and income feeding you money.
If on the other hand that $500 per month will go towards paying for the mortgage on another house ... well then you're back at square 1.
IMO, take the 6 months out of the equation and just consider it as "Can I afford to pay for this property without any additional income coming in?" Assume the worst case scenario of having no income.
Also that $500 per month will be taxable income at the end of the year, don't forget that. Depending on where you stand, also consider if this is enough income to push you into a higher tax bracket and plan accordingly.
Finally, if you move into another place and rent both of your units out, will you be paying more or less in either rent or mortgage for your new residence? If you move into a more expensive place, will you still be able to afford it if your units are sitting empty?
