please to shoot me fulla holes

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So tell me if this works.  I've been trying to work up ways to conduct serious activism locally.

You buy a house.  Not your house, some other house nearby.  It's a rental property and you're going to rent it out.  This is not a good start for activism, I realize, on account of being a landlord is kind of a

Comments

[yip95]

I could be way off here, but I seem to recall hearing that, in order to buy an investment property (meaning a house that is not going to be your primary residence) that you need to have 20% down.

That's a big chunk o' change. Like pesto_maker said, not too many of "us" have that kind of cash sitting around. Perhaps there are ways around it, with shady loans or somesuch, but I'm pretty sure it's not the same as buying your first house.

Also, have you figured out exactly how long it would take to pay off a mortgage on such a house? You can get a 2-family in our neighborhood for $150K. That's a mortgage of about $1500, say. Cuz you're not going to get any awesome mortgage rates like you can for your 1st home. You'd have to charge ~$750/mo/unit just to pay the mortgage/taxes/PMI/insurance. You'd have to charge more than that just to have an emergency fund/money for extras.
Sure, there are much cheaper buildings down 2nd Ave and such, but they very well may be inhabitable and who knows what you can reasonably rent them out for once you spiff them up slightly. (okay, so i just checked, and there is currently a house around the corner from you on 2nd that's $116,500. I guess you could charge enough to have a little extra in the pot, but not a ton.)

I guess where I'm going with this is that I love the idea, but I'm stuck on the numbers. Can you actually make it happen in our neighborhood? And how long would it take for there to be profit that can be reinvested in the property?

[kombu]

I will do some research with real numbers on this. I will post today or tomorrow with said real numbers.

I'd also like to point out the possibility of partnering with a charitable organization or getting special federal or state grant money for a project like this. The first is probably more do-able on the small scale. The idea would be to get some downpayment money out of them, cuz Dan is right that there aren't likely to be very many folks out there ready and willing and able to take this on w/o that kind of assistance. My place of employ is currently looking into affordable housing development ideas. We are looking for something that would bring in some profit, but I have printed out this thread to toss around ideas with my boss.

Selling to the ACLT would ensure affordability and owner occupancy in perpetuity. There are, I believe, other ways to do that, such as deed restrictions. I sort of agree with Robin that it'd potentially be OK to just let it go to the lt tenant for payments already made plus a little, no restrictions. But, I think I'd rather do the Land Trust thing if it were me.

Interesting idea. Once I've crunched some numbers I'll let you know if I think it's do-able from that angle. My other concern would be posniesd's and others' about how much time it would take to manage it.