Can You Start Investing While Still Renting?
These days, people are getting more and more creative with how they capitalize on the rising number of available homes. If you are one of those people, you have probably thought of buying a property that you can rent out while you are still renting, too. You may be wondering if it’s really feasible. Can you really start investing in real estate while still living in rentals? The answer is yes.
Here are some excellent reasons for you to consider this option:
It’s a Great Path Towards an Increased Cash Flow
If you play it right by living in a space with a rental cost that is lower than your investment property then the latter can really be a long-term asset. It can provide you with income for years and years! And if there’s enough to cover your expenses and still have some left to save, then you’re set for financial freedom!
Living in Your Property Means You are Not Making Money from It
Unless you intend to run a bed and breakfast or rent out a room or two in your house while you’re living there, it’s somewhat unlikely that the property will be a source of income. Owning a house and living in it means you’ll be spending money on it instead of earning money from it.
You Get to Enjoy More Tax Exemptions
An investment property is tied to your income, so you can write off the investments that you make in the property as improvements. You can claim deductions on the mortgage. On the other hand, when you live in your own house, there will be fewer tax deductions and write-offs.
You Don’t Have to Choose Between Growth Potential and Your Current Lifestyle
Many people who are purchasing their first home can easily afford a property in the suburbs but find properties in the big city a little too expensive. If you’re living in the city and your job and your friends are there, does that mean you should give those up and live in the suburbs? Or do you just have to put off buying a property until much later when you can say goodbye to your current life? The answer is neither! You can look for a house in an up and coming neighborhood, rent it out, and continue your happy life!
It’s an exciting time when you realize that you are financially, mentally, and emotionally ready to buy a house. And the best thing is, you can make that purchase pay for itself by turning it into an investment property!
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