CityRealty Insider > Buy a Home, Become a Landlord

Buy a Home, Become a Landlord

DECEMBER 17, 2009

Buying a small building can be a good business option for urban homeowners.

Purchasing an income-generating property in a 2-4 unit building is a classic way of lowering the cost of ownership. The idea is to live in one of the units and rent out the rest.

You can avoid regrets by knowing the caveats going into the deal. Like any business, rental properties are susceptible to market volatility among other unexpected occurrances.

The usual must-do list for property ownership applies even more so here. Hire a licensed home inspector. Get an engineering report and general inspection on the property. Check the property on the city register. Consult a real estate lawyer. To determine how much income you can expect to generate, talk to current tenants about a host of issues including how much their rents are, whether apartments are rent stabilized or not and more.

Buying with friends brings additional reasons to use caution. Not all lenders will give loans if more than two people are sharing. It’s a good idea to enter into a Deed of Trust at the beginning, specifying the share of the property, major costs and what will happen if circumstances change, and agreeing on a minimum period during which you can’t sell.

ALSO IN NEW YORK CITY INSIDER

RLS IDX Data display by CityRealty.com, LLC. This information is not verified for authenticity or accuracy and is not guaranteed and may not reflect all real estate activity in the market. ©2024 The Real Estate Board of New York, Inc., All rights reserved. IDX information is provided exclusively for consumers’ personal, non-commercial use and it may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing.

All information furnished regarding property for sale, rental or financing is from sources deemed reliable, but no warranty or representation is made as to the accuracy thereof and same is submitted subject to errors, omissions, change of price, rental or other conditions, prior sale, lease or financing or withdrawal without notice. All dimensions are approximate. For exact dimensions, you must hire your own architect or engineer and for no listing shall the number of bedrooms listed be considered a legal conclusion.

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