Jason and I have talked about starting to invest in real estate for a while now. We probably started talking about it during my sophomore year in college (over 5 years ago). However, this is something Jason has had in his mind for a long time. He always had this idea of a two-family home being his first home, but our plans became more definitive as we discussed it further. There are several reasons why we decided this was the right choice for our situation; here are my top 4.
1. We were able to become homeowners at a young age.
Owning a home is a huge (completed) goal for us. Jason specifically has been working towards it since high school. His hard work is really the major reason we have the healthy down payment and renovation budget we do. However, purchasing a home with a rental unit allowed us to use that income towards qualifying for the mortgage. Although I receive a stipend from medical school, it’s difficult to use it for mortgage purposes and so we used solely Jason’s income to qualify. The real estate investment aspect afforded us a decent budget for our first home.
2. We have flexibility when it comes to moving in the future.
When starting this house search, we had the intention that it is not going to be our forever home. We plan to move into another house within the next 3-4 years, but keep this one as an investment. This means that we framed our decision making from a mostly real estate investment angle, but also that we aren’t tied to a single place. Often, I hear that freedom to move if needed (or wanted) is a reason people choose to rent over own. I feel our path is another way to get around that. Further, we can use the income from our current investment to help us qualify for our next mortgage. Being in medical school, we are very aware of the possibility that we might not be staying in the New York suburbs once I begin residency. We have taken this all into account when forming our investment plan.
3. We can feel a little more comfortable with our monthly budget.
Before we got into real estate investing and the house hunt, we looked at our income and expenses (including estimating our expected expenses) to determine our budget. It was important to us that we are able to comfortably afford our home even without the rental income. Now on the other side, having that rental income makes it a little easier to breath each month. We have the extra income to build up an emergency fund, save for a fun vacation, or pay down or mortgage faster. It’s also nice knowing that if we’re ever between renters or my stipend is delayed (like every time), we won’t have to dig into our emergency fund.
4. We are setting ourselves up for success.
This is one of the biggest reasons we decided to invest in real estate. It’s also something I 100% believe to be true, despite the risks. As we follow through on our investment journey, we will be able to devote more time to the things we love. And, since we are starting to invest in real estate so young, we will have more time to watch those investments pay off.
There are many reasons to invest, whether that’s in real estate or otherwise. And, no two people will really have the same ones. It’s important to keep your own in mind and develop a solid plan to reach your goals.
Are you looking to invest in real estate?
Share your biggest reasons with me!
