Give me your thoughts on this one. Have an opportunity to purchase a 2 BR single family home w/ 2 car garage two doors from me for approx. $45,000.
It's a modular on 2 acre plot which adjoins our farm and has seen numerous owners and renters come and go over the years, some who have not kept the place in very good shape. Considering purchasing this as a rental to control who my neighbors are, what the place looks like, and as an investment.
Here is the math:
Could probably buy for $45,000 cash, no loan.
Looks like it's ready to rent , cleaned up with very little needed presently.
For safety factor, figure I need to throw another $3,000 in upgrades making total $48K.
Taxes would run +/- $1500 annually.
Insurance $400
Mowing (25) times @ $50 = $1,250
Snow removal +/- $300
Total annual expenses = $3,450
Pretty sure I could easily rent for $750 / month grossing $9,000 and netting $5,550
That's about 11.5% return on $48K
** Understood I will have occasional large expenses like a furnace or roof down the road at some point that could cut into this.
Thoughts?
Worth the time and effort?