JLM Blog | Don’t Buy A House: Real Estate Tips with Jason LeeReal Estate News, Updates, and Tips
JLM: Real Estate Company San Diego
Article published on September 19, 2022.
Buying property is one of the biggest investments you can make, but you should take the route that will lead to financial freedom. The “American Dream” is to work hard, buy a house, live there, and hopefully raise a family. This is what usually people do when they purchase a home.
Instead, you should buy an investment property before buying a house of your own. Your investment will pay for you mortgage, taxes, and provide you with everything.
Things to consider when buying a house:
You’re buying a liability.
A mortage is a liability is to be paid every month and purchasing property requires other expenses such as insurance and property taxes. In turn, this is not the best way to acquire and build wealth.
The US Government wants you to buy a house
The most prominent and leading mortgage programs, Freddie Mac, and Fannie Mae, are both government sponsored programs — meaning the government takes profit from the loans that citizens get.
A house is a big investment
Usually, if you purchase a house, you won’t be able to diversify your portfolio meaning that you can’t put your money in other investments or your retirement.
How did Jason attain financial freedom through property investments?
1. His first property purchase was a two-unit property in Normal Heights, San Diego (Central San Diego Area).
2. The property required a lot of work, but Jason was able to purchase this property off market with a fair price.
3. He built two ADUs (additional dwelling units) to the property and his property into a four-unit property— spending about $500,000 out of pocket.
4. The construction on the ADUs added so much value to the property that he was able to do a cash out refinance after one year.
5. He was able to get his return on investment tax free.
6. He used the property as a rental property and it created a monthly cash flow allowing him to pay for :
- property taxes
In addition, he would still have an extra $6000 after expenses.
7. He could then possible use that $6000 to purchase a house of his own if he wanted to.
House hacking is when you buy the investment property, live in the property, and also use it as a rental property. This method would provide you with cash flow and would be a better option compared to just buying a single-family home.
With this set-up, you can get an “owner-occupied” loan. This particular loan has better interest rates with a lower downpayment compared to an investment loan.
San Diego Real Estate
Location is a powerful tool that will help you make the most returns out of your property investment.
San Diego is a great place to purchase multifamily properties and JLM Real Estate has real estate advisors who have the experience and expertise when it comes to providing you with the best deals.
Investing in a multifamily property can change your life and give you financial freedom.
Get a free consultation from Jason Lee today.
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