Real Estate Basics

[BarkingMad]

[ QUOTE ]
wouldn't it make sense to buy outright and not pay interest?

[/ QUOTE ]

No. The simple answer is "leverage".

Say you have $100,000 to invest, and pay cash for a $100,000 dollar duplex. Assume that in your first year of ownership, your duplex appreciates 4% in value. Well, congrats, you just made $4000, a 4% ROI (Return on Investment) on your large investment. Not exactly a banner year.

Now assume that you split your money into 5 $20,000 down payments, which you use to buy 5 duplexes, which all appreciate 4% during the first year you own them.

I'll let you do the math.

[LondonBroil]

[ QUOTE ]
[ QUOTE ]
4) How do you advertise the property to get rentors?


[/ QUOTE ]

Craigslist



[/ QUOTE ]

I made a mistake typing in the address and went to Craiglist. Whoops! (NSFW [img]/images/graemlins/blush.gif[/img])

[chisness]

good point, but i think in my spot i might be forced to pay outright since i won't qualify for a loan and probably wouldn't be able to manage that many anyway.

but in the future, this very clearly makes sense.