Live in Your Investment

I am constantly trying to help my clients come up with creative ways to buy and sell real estate. When I get the type of client that I think would be interested, we talk about how a great way to get into real estate investing is to buy an income producing property that you can utilize for yourself, too! 

Whether you want to buy a residential or commercial property, you can get more favorable bank terms by “owner-occupying”. The actuarial tables for projected default to the banks show that if you own property and are occupying it for your use, you are less likely to experience a foreclosure which in turn minimizes risk. The lower the risk, the lower the rate! It is not uncommon for someone to get a 2% improvement to their interest rate by occupying it themselves and then leasing out the leftover space or units. 

Duplexes and fourplexes are popular residential conduits for this type of investment. Find yourself one of those at a bargain and you will be on your way. As far as commercial properties go, I think small office condos and retail strip centers are ideal. If you own a retail store and have a couple of years in business, it’s pretty easy to obtain an SBA loan with low down payment and a great interest rate.  Do your homework and discover what the anticipated rents and hold times will be before buying. If you do a good enough job in negotiating, you could likely be living rent free for yourself!