Evening star. [volume] (Washington, D.C.) 1854-1972, 1924-02-16


article In the Garden and Home, out
lines a plan whereby you can build
your home and have it help pay for
itself Suppose" says Mr.. Brinkloe
you own good sized lot in a good
neighborhood; you are tired of pay
ing rent: you want to build a COM
Portable little bungalow for yourself
and your family on this lot
But Well suppose the lowest esti-
mate you can get on the sort of bun
galow you want is $4,000, and, since
You have not sufficient cash, you'n
have to borrow this at per cent
interest, taxes, insurance, repairs, de-
probation, and SO on, will probably
| run you fairly close to 4 per cent
additional. Most real estate owners
| figure they must get 10 per cent gross
| rental on a property to net per
cent. So your $4,000 house cost you
| an average fixed charge of nearly
| $500 per year, or $50 per month.
| THAT'S all right, you say. You are
paying $50 per month in rent now.
! Fifty Dollars Limit.
Fifty dollars. however. is about
your limit. You can carry the mort
gage, but you can't reduce it to any
extent. That's bad finance. Indeed,
| the bank will probably refuse to lend
! the money unless you agree to reduce
| the mortgage certain amount each
! year.
J What can you do?
| We'll, In many cases a two family
house will solve your problem. You
! build first-story fiat for yourself,
galow. Then, above this, you build a
! second-story fiat, to be rented out.
The cost of these two flats will be
very decidedly less than twice the
cost of your bungalow, since the same
| roof and the same foundation serve
for both fats. Moreover. you are
putting your ground to work, max ing
| 1T do double duty. You will be your
! own agent and janitor, advertise for
| tenants. collect the rent, attend the
! fires, and so on.
| Rent to Garry Charges.
Therefore. under normal condi-
! tions, YOU can probably get enough
rental from the apartment to carry,
4 or nearly carry, the fixed charges,
leaving your $50 free to apply on the
! mortgage. And as this is cut down
| your interest charge decreases, leay-
! ing more and more extra cash to
| clean up the balance of the mortgage.
| However. you must look into the
| matter very, very carefully before
! you start work. Find out what types
F.. of flats are in greatest demand, what
| rent you can get. and what the fixed
! charges are likely to be-taxes, in
surance, repairs. fuel, and so on. Also
be very sure there is no drawback to
! Your building Site-it may tbe too far
! from a trolley line. or on the wrong
! side of the street, or too near an ILL
smelling factory, or something O: the
sort. Next, get actual bids from one
| or more contractors on the building
| you want. Then you will be in shape
| TO go to your bank and put the whole
| thing before the president. If he be-
! lleVeS your venture to be a good one
from a business standpoint, he will
, no doubt do what he can to help YOU
| finance it. If he does not think it a
| good business proposition, he will tell
you so very frankly. In that case
| you had better drop the matter He
| is just as anxious as you are to put
the thing through, for the man who
owns his home and is getting ahead
| always has a much bigger bank ac-
| count than the man whose money is
all going out in rent.
Sort of House to Build.
!! II can't give you any definite advice
as to Just what sort of house you
| conditions. But there are three diff
ferent types of two-family homes
Your builder, your broker and your
banker can help you decide which
! type is the best for your particular
case.
Now perhaps you can't quite
| finance at this time a two-family
house, but you hope to be in better
shape little later on. Very WELL
| You can build a bungalow and leave
the upper part entirely unfinished 1t
will be a comparatively simple mat
| ter to finish this later on.
Or you can build the first story
! of house. leaving off the entire up
per story and put on a bungalow roof
! and when You have raised some more
money you can likewise raise the root
| and build in the second story. 1t is
a very sensible thing to so plan your
! home that you can expand it into a
i two-family house whenever you