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09.06.19, 20:20 PM General Topics
18 replies
Considering buying a 2 bedroom in Santa Monica/Pacific Palisades, renting to my best friend, and visit 1/3 of the year. When I use NerdWallet's calculator there is no home value that makes buying better than renting. When I use Zillow's calculator after 8 years a $1.3M is. The M/P about inlaws haunts. Best friend and I lived together before, so not a worry, and I know rental history, so another no worry. WWYD? [ Reply | Watch | Flag ]
General Topics 09.06.19, 08:20 PM Flag
 

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Sorry but can't fully understand your question, so I'll just jump in with my questions: have you ever been a landlord before? Are you willing to risk your best friend over house issues/rent payment? What do you mean "there is no home value"? Have you done a basic calculation of your costs vs revenue? Have you spoken to your accountant about how much you can write off in income? Have you run credit on said best friend? [ Reply | More
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General Topics 09.06.19, 08:28 PM Flag
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OP - Yes and I hate being a landlord. No and I value this relationship more than any other. Nerd Wallet's calculator says it will never make sense to buy at the rent amount my friend pays and that doesn't improve with a 30% increase either however Zillow's calculator says $1.3M breaks even after 8 years. That's the only calculation I did. I haven't spoken to my accountant. I haven't run credit but know leased car in December so must be decent? Also I previously paid off their student loans, but there could be an unknown mountain of credit card debt. [ Reply | More
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General Topics 09.06.19, 08:37 PM Flag
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You paid off your friend's student loans??? I would consider adoption. Probably cheaper. [ Reply | More
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General Topics 09.06.19, 08:46 PM Flag
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:/ [ Reply | More
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General Topics 09.06.19, 08:49 PM Flag
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I think you are crazy. Why in the world would you do this? [ Reply | More
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General Topics 09.06.19, 08:42 PM Flag
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+100000 [ Reply | More
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General Topics 09.06.19, 08:45 PM Flag
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OP - Part of me says this is an opportunity? A win win? Friend is an available long term tenant (current building is being converted so lead time to purchase property), I like Santa Monica, I'd live there again, I have no interest in being a landlord, my friend will never be able to buy. But the other part of me is "post this on UB to talk some sense? cents?" [ Reply | More
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General Topics 09.06.19, 08:52 PM Flag
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NP. The ONLY way I would do this with a friend is if I got 12 months rent up front. There are too many things that can go wrong and leave you on the hook for making mortgage payments with no rental income. She lost her job; her boyfriend broke up with her; she's going through a tough time, etc. Excuses why she can't pay her rent. [ Reply | More
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General Topics 09.06.19, 08:55 PM Flag
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Sorry, I would never do this. Even if you never had issues with your friend it’s not worth it to buy if it will take 8 years to break even. Don’t do it. Just rent when you need a place. [ Reply | More
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General Topics 09.06.19, 09:07 PM Flag
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This. It’s a stupid investment, like a timeshare. [ Reply | More
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General Topics 09.06.19, 09:26 PM Flag
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I would never mix a friend with finances in this way. [ Reply | More
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General Topics 09.06.19, 09:12 PM Flag
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This. So many things to go wrong, you are risking your friendship. [ Reply | More
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General Topics 09.06.19, 09:36 PM Flag
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+100000 [ Reply | More
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General Topics 09.06.19, 10:23 PM Flag
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[ Removed by moderator ] [ Reply | More
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General Topics 09.06.19, 09:35 PM Flag
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DO NOT do this. 1) Your friend sounds financially irresponsible. 2) It's a bad investment. [ Reply | More
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General Topics 09.06.19, 10:13 PM Flag
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This is a trainwreck. if you are her landlord, it is NOTHING like being a roommate. What if she cant pay the rent? will you take her to court? What if you want her to move out or sell while shes there? NEVER would i do this. [ Reply | More
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General Topics 09.07.19, 12:19 AM Flag
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What if she decides to move to a new city and leaves you without a tenant? What if she breaks stuff in YOUR house or doesn't treat your place in a way that you think is considerate? So many possible issues that could cause a rift between friends. [ Reply | More
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General Topics 09.07.19, 12:28 AM Flag
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I don't do business with social acquaintances, so it's a big nope for me. What if she falls behind on rent? What if she resents your using it four months a year? [ Reply | More
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General Topics 09.07.19, 03:43 AM Flag
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