# Buying a second property - to be half rented, half personal



## moonlighting (Nov 21, 2013)

Hello - I want to buy a second property for a couple of reasons: First, it will be closer to where my husband works, so we want to live upstairs and have a basement that has a rental self-contained suite in it (or one to be installed by me).

Ok, first property is paid off. My husband wants to rent it out.

The first question is, will I be able to write off interest for the portion of the new property that will be rented out?

The next question is, is it worth it to keep the first property as it is paid off? I understand that the ROI on a paid off property is not good.

Thanks!


----------



## Just a Guy (Mar 27, 2012)

You should be able to claim a portion of the new property's interest payment as you are renting out a portion of it. Remember though that you can't claim the tax free capital gains on the entire property if you sell it if you do.

As for the original property, it depends what it's worth. If it's a 500k property which you can only rent for $1500, you could probably do better selling it and buying something else...like 5 rental properties for 100k you can rent for $1000 each, or better yet put a 25% downpayments on 20 rentals for 100k that you could rent for $1000 each.

If the property is worth less, and you can rent it for more, then it may be worth keeping. You could, of course, refinance it to buy more rental places or other investments as well.


----------



## moonlighting (Nov 21, 2013)

Thanks, I never thought of those numbers - appreciate it very much!


----------

