4 Reasons Why Your First House Should Be A Duplex
When you are buying your first home, there is a lot that you need to think about. In most cases your home will be the single largest investment you will make; this means that you need to be vigilant about what you buy so you can make sure it works for you.
A duplex is a house that has been split into two separate units. If you buy a duplex as your first home you can live in one unit while renting the other unit out. Here are 4 reasons why you should consider buying a duplex as your first home.
1) Mortgage Payments
In most cases mortgage payments are the single largest expense for a home owner. As a first time home owner the thought of owing 80–95% of your homes value to a financial institution can be daunting. The great thing with a duplex is that the income generated from renting the second unit can help go towards paying off your mortgage. In some cases, depending on the area (house prices and rent rates), the income from the second unit can pay for the entire mortgage.
2) Home Improvements
If you are renting out a portion of your home, you can claim home improvements as expenses against the income from the rent being paid. This means if you paint the house, re-do the deck, repave the driveway, or put on a new roof, you can claim the costs of the repairs or improvements against the rent coming in.
3) Safety Net
If you live in a single family house you are responsible for paying your mortgage, property taxes, maintenance costs, and other bills that pop up. While this doesn’t change when you own a duplex, you have the safety net of the rent coming in. If something happened where you couldn’t work, or if you lost your job, the rent payments can help tide you over until you could work again.
4) Long Term Investment
Most people will outgrow their first homes. If this happens it usually means you need to list your home, sell it, and move to a new larger home. If you have a duplex, you can look at keeping the property as an income property and purchase a second home for your family to move into. The duplex can become a great investment, and the rent collected can help pay for vacations, college tuition, medical bills, or other life expenses.
This article is for informational purposes only; it should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.
