3 Reasons You Should Consider a Duplex as Your First Home Purchase

3 Reasons You Should Consider a Duplex as Your First Home Purchase

3 min read
Larry Alton

Larry is an independent, full-time writer and consultant. His writing covers a broad range of topics including business, investment, and technology.

Larry started his career with Demand Media. There he contributed to and edited nearly every type of business-related content from real estate investing to software and digital media.
Since then, Larry has worked as an independent, full-time writer and consultant. His writing covers a broad range of topics including business, investment and technology. His contributions include top-tier publications like Entrepreneur Media, TechCrunch, and Inc.com.

When he is not writing, Larry assists both entrepreneurs and mid-market businesses in optimizing strategies for growth, cost cutting, and operational optimization.

As an avid real estate investor, Larry cut his teeth in the early 2000s buying land and small single family properties. He has since acquired and flipped over 30 parcels and small homes across the United States. While Larry’s real estate investing experience is a side passion, he will affirm his experience and know-how in real estate investing is derived more from his failures than his successes.

Larry graduated in the top 2% from Iowa State University’s Ivy School of Business Management.

Larry on Entrepreneur
Larry on Huffington Post
Larry on Business.com
Larry on Inc.com
Larry on TechCrunch

Read More

Join BiggerPockets (for free!) and get access to real estate investing tips, market updates, and exclusive email content.

Sign in Already a member?

When most people think about buying their first home, a nice little brick house with a white picket fence comes to mind. And while there’s nothing wrong with this, maybe you should actually be thinking about a duplex.

3 Reasons to Consider a Duplex

If you’ve never thought about owning a duplex, then you’re probably unaware of just how many exist in your market. Duplexes are everywhere, and they can be extremely wise investments in certain situations.

While you probably don’t want to buy a duplex if you have a family with kids, it’s perfect for someone who is young and single (or newly married). Here are a few of the benefits you’ll get to enjoy.

value add multifamily

1. Mortgage Benefits

Before you can even consider buying a duplex, you have to get your financing squared away. As On Q Financial explains, “The pre-qualification process is the best way to determine the numbers that are right for you. Early in your search, you can work with a mortgage professional to get prequalified and search for homes within your wants, needs, and budget.”

What you’ll find is that a duplex may actually help your mortgage situation, if you plan on renting out the other half. For example, let’s say the mortgage on a duplex is $1,800 per month, but you can rent out one half for $1,000. You’re essentially getting 55 percent of your mortgage covered. Not only does this save you money, but it could also help you build equity much quicker (if you choose to make larger payments).

Related: How to Buy a Duplex: The Ultimate Step by Step Guide

2. Tax Benefits

As you’re likely aware, you can deduct the interest on your mortgage come tax season. And while you can only write off the side you live on (in a duplex), you can gain access to additional write-offs by renting out the other half. This includes fees accrued to rent the place, as well as things like repairs, maintenance, and utility bills (if you share them).

3. Ability to Learn a New Trade

Another added benefit is that you get to learn the ins and outs of the landlording business firsthand. This will either show you, at an early age, that it’s something you’re not interested in, or it’ll give you the experience and confidence needed to launch a career in real estate investing.

Acknowledging the Downsides

Duplexes aren’t perfect. In full disclosure, there are some potential disadvantages that you need to be prepared for if you plan on investing in one. The two biggest are:

1. Lack of Privacy

For some people, the lack of privacy that comes with living in a duplex that you own is just too much. Not only do you have someone living just a few inches away from you at all times, but there’s also the risk of late-night knocks on the door. If the air goes out or a toilet gets stopped up, there’s no hiding. You’re on call 24/7.

Related: How Single, Work-at-Home Mom Maria Bought Her First Duplex

2. The Unknown

Finally, there’s the unknown. In a duplex, there are two of everything—including toilets, appliances, and fixtures. This means there’s twice the likelihood that something will break down and you’ll have to fix it (cha-ching!).

There’s also the risk that the other half will sit vacant for a period of time, resulting in no rental income. Keep this in mind as you weigh the pros and cons.

landlord, rental, homeowner, realtor

Give Yourself a Financial Head Start

When it comes to buying your first house, perspective is key. You have to realize that you aren’t going to be in this house forever. In fact, most people stay in their “starter” homes for less than five years.

Think about the pros and cons, weigh them against each other, and determine whether or not a duplex will work in your situation. For most young homebuyers, it turns out to be a smart decision.

blog ads 02

Are you considering a duplex for your first home purchase?

Leave a comment below!