I've been wanting to dip my toe in real estate for a while now and also have a soon to be broke parent. I decided to shoot two stone with one bird.
I came up with the brilliant idea of purchasing a duplex and having them live in it as an onsite manager. They will basically watch the other tenant and snitch on them if they do anything that goes against my interest. Instead of them renting a dingy apartment for $1k a year they can use that money to help me finance a property that they will live in until they die, or until they need to go into a senior home.
If their money is going to finance someone else's investment it might as well be my investment in their future.
Does this sound like a stupid idea or something doable?
They will probably become my dependent in about 10 years. I don't know about the market due to family and work etc, but It will probably be LA. I am a young man and am not committed to a city yet ,which I heard can be a problem for first time RE investors.
Not dumb but understand what you're getting into. I've been taking care of my parents for 20 years (housing, auto, insurance, etc.) It's great to be in a position to do that and your parents are lucky you're willing and able to help. I would separate the issues. Help your parents because you want to help your parents, not because of any help they provide in watching over the duplex. That's a side benefit that may or may not work depending on how they age. Is it the most appropriate place for them to live? If so, great. If not, consider them living somewhere else and taking the rent you get form the duplex to offset their housing cost.
My experience with paying for my parents has been that they ultimately start becoming more like children where they expect things. A handout no different than the government programs except I get to decide how things are spent. Be careful as it can change the relationship.
At the end of the day, is this post about RE or caring for your parents? Very different scenarios.
This is the kind of wisdom that keeps me hooked on this site. True and insightful. It's like giving your close friends money, knowing you will never get it back. Do it for the reason that matters to you.
I would say this is a much more realistic scenario. Onsite property management can make them feel some responsibility, but some people are just not cut out for managing a property. Not that it's inherently difficult, but is is frustrating at times. I don't know your parents so I cannot say if it is a good idea or not.
Do they HAVE to be in LA? There's lot's of affordable places in LA if they don't want a lot of room. Big if there.
But for $2k a month (maybe a bit more), you can get a nice 1 bedroom in Costa Mesa. Right next to South Coast Plaza, 20 mins (or less) from the beach, nice weather. Huntington Beach is not too bad either, it's just a pain to get into/ out of. I have no clue what cash you have, but at $2,500 that would cost you $600k to outright buy a 5% cap place anywhere else. You can adjust the numbers with leverage and such.
If you want help- PM me. I love helping people think about RE investments.
Mom has been a manager at a point in time and even called the cops on someone.
Originally, I wanted to purchase a property but I am a young guy and may move around to find a good job if my current job doesn't work out. I thought it would be ingenious to shoot two birds with one stone. I don't know if purchasing a property and designating one unit as low income for the one parent reaps any additional tax benefits. So, yes I want to own property. The parent thing is just the cherry on top.
Do you agree that purchasing a property in an area where you may relocate out of would be a bad idea?
I'll PM you later. I appear to have reached a limit for today.
I edited the original post to be more clear.
I can DM other people but I can't DM you at all.
Are you concerned about any of your coastal properties being affected by rising sea levels?
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