For a rental property, i have to choose between 1 BR apartment in a city I love and have a relationship with, but a very expensive city ($300k apt)—OR a not nice city I’ve never been to, twice less expensive ($150k), but both have the same rental income ($1,000/m). Rational thinking would go for the 2nd one. Am I being crazy for wanting the first one? Part of me wants to give it to my son who might study there, or have it for myself in case smthg happens. Advice on how to approach this?

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Is the 1,000 net of all costs for both? Or are you only able to rent it for a total of 1,000 per month?

If net, then the 150k is a no brainer from a financial standpoint - significantly higher return.

I’m not sure how old your son is but you could potentially factor in the cost savings for him if you’d like him to live in it for free.

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Thank you! No it’s only the total rental.

My son is 3. There’s a fair chance he’ll want to move to this city when he studies, as we will be moving back there too and there are great options. But even if not, I think there’s something reassuring in me owning something there. It’s kind of emotional (and maybe silly as I write this down).

When you say cost saving, it’s assuming I pay for his studies to go to a campus, correct? That’s a great way of thinking about it.

It seems that the investment in the first city would bear half the risk of the second one. That's finance. Given the same return but different prices, I would assume that one has a higher opportunity for appreciation and is generally more desirable. The other may be suffering from crime, unemployment, stagnation, etc.

Very limited facts in your post. But also, I'm in the US and a local person would be better positioned to advise.

You may also want to seek advice from a local tax pro.

helpful

Yes i think it’s a good call to look at the appreciation opportunity in both cities. But still I think it’s stagnating. It’s kind of like a New York in Europe but the government is blocking the rental prices so it doesn’t drive away the middle class of the city. So rent stays low by law even though the home values have sky rocketed.
Thanks for the advice on the tax professional too.

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(This is in Europe btw - I have family there tho I live in NY)

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