I’m a 32M and I bought my first duplex in November 22’ with an APR of 6.25% and a mortgage of $2100. This takes up about 50% of my net monthly income from my W2 job. After living there for a year, I sublet my unit and moved back in with my parents, now grossing $4200/month since both units are occupied with 1-year leases. I’ve been able to replenish my nest egg and now have $85K in liquid cash saved in a HYSA. I plan to house hack and owner-occupy my second property, which will be a multi-family, and rinse and repeat my strategy from the first property. I’m pretty nervous that in a worst-case scenario, my first property could become vacant and I’d have to cover both mortgages, which would exceed my monthly W2 income. Any advice would be appreciated. TYIA!
If you can’t afford to pay the mortgages without the renters’ income, that’s sketchy. It’s always a matter of when you have a vacancy, not if.
Stocks are a better investment.
I’m 70 and bought rentals on a shoestring and hard work when I was young. I only have one left now. I net about $2000 a month and have about $500,000 in equity. I sold one on a contract about 2 years ago and will have a $2250 monthly payment for 4 more years and then a balloon payment. I sold another duplex about 5 years ago. Sooooo, as far as I’m concerned, it was worth the juggling and pain in the rear 
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I like the initiative, but it is a risk. Before going into a second property, I would try to set up a cash reserve specifically for repairs and to cover the mortgage during vacancies. How much? Good question.
@Roan
That’s a good point. I hadn’t thought about setting aside a specific cash reserve. How much do you think would be a reasonable amount?
Sky said:
@Roan
That’s a good point. I hadn’t thought about setting aside a specific cash reserve. How much do you think would be a reasonable amount?
It really depends on your situation, but maybe aim for at least 3-6 months’ worth of mortgage payments. That way, you have a buffer if things go south.