Duplex Insurance Richmond

Duplexes - One Of The Greatest Investments You Can Make

When it comes to property investing, most individuals will gravitate towards one family home. But were you aware that buying a duplex or a tri-plex is a much better investment? Let's look at the three main things in real estate investing. Money flow, Appreciating and Value.
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As anyone knows in real estate, the aim is for positive cash flow; otherwise you own an investment which costs you money on a monthly basis. Positive cash flow is simply defined as cash left over after paying for your mortgage, property taxes, insurance, and any monthly utilities and repairs.

A residence is a money pit which can cost you money in the method of the mortgage principal, interest, taxes and insurance. Add to the regular maintenance and repairs and after everything is said and done, the only investment value a home actually offers is appreciation and that is speculative based on where you live. Not many markets have rising values all the time and land values can be effected by plant closings, layoffs, etc.. For many practical purposes, a residential property, a "home" does not fall in accordance with the genuine spirit of property investment, which is property the will cause income-producing "positive" cash flow. Really, single family residential home used as a home has the reverse effect and triggers outgoing money flow. . .thus, the "money pit".

The smartest way to invest in residential property and still generate some form of "positive cash flow" is to purchase a duplex, live in 1 side and let the other. Many times the rent income coming in from the other side can practically cover the mortgage payment of the entire property supplying nearly free home to the proprietor. The renters on the other side are not merely paying your mortgage, but they're helping you build equity in your own property. This equity will even grow over time with appreciation, supplying two sources of wealth building: you from money flow pay-down of the mortgage and another, land value growth through natural appreciation.

The amount of money you would usually spend on one family home mortgage payment (PITI) may be saved, in whole or in part, as a deposit to the next duplex throughout the time you reside in the house.

The name of the game is to buy a duplex, reside in half, let the other half out and save to the next duplex. When you have enough money, move from the duplex, then rent the device and continue into the next duplex and repeat the procedure by renting another half out. This way you could have 3 sources of earnings working for you: income from unit A and B in the initial duplex and income from unit B in the next. Now you have real estate working for you and you are on your way to serious income producing cash flow.

The only real downside to this job is you might need to live next to your renter for a time period. The upstroke is it gives you a taste of property direction without biting off more than you can reasonably weigh. Indeed, this very notion is how many real estate millionaires are birthed.

Not many men and women consider this angle when they are searching for a house and it is worth careful consideration and serious consideration. You have two options: The money pit or income producing property. It's a choice you'll need to make.

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