I was wondering if anyone here had any info on buying an investment property?
We don't have a lot of money, our savings hover around the $5k mark (we're just building it back up after DH being out of work for 3 months).
We have around $100k equity in our house (we haven't had it valued but I think it would be around this, maybe as low as $70k or as high as $120k). We had thought about refinancing and using the money to do this place up, but we know this isn't where we want to stay, we ultimately want a property but there is no way we would be able to afford one now. There is also no way we would get a loan for a new residential home as we simply do not have enough income.
We don't really know how the whole 'investment' thing works, someone had told us that you don't need any actual cash to buy an investment, that you can simply use the equity in your home to fund the purchase and the rent to cover the mortgage (obviously allowing for a shortfall, repairs, maintenance, vacancies, etc). Is this right?
If so, we were thinking that we could use our current equity to purchase an investment property, then once that has developed some equity use that to buy another, etc and then in about 10 years sell the lot and buy our property.
Is this actually a feasible idea or do we have it all completely wrong???
Any help would be greatly appreciated.