I'm thinking about making an offer on a duplex of $155,000. It's in a relatively affluent neighborhood, that's regarded as the "fun place to live if you're in your 20s" locally. Prices are likely to go up, though I don't want to factor appreciation into the cost.
The units are both largeish 2 bedrooms, with a private porch, and a shared backyard (which some of which might be used up by an addition in the future). My guess is that they'd easily rent for $900 each, and if you searched around and cared less about tenant quality, you could rent them at $1000, which is what the currently rented unit is at.
I'm thinking about living there myself, and renting out the other other unit. However, I'm trying to make the math work as an investment property first, to see if it makes sense to buy it at all.
Here's monthly expenses as I see them:
Mortgage: 833
Taxes: 450
Garbage: 57.25
Snow Removal (ammortized): 15
Lawn Mowing (ammortized): 25
Water: 25
Insurance: 60
For a total of 1515.25
Income would be 1800 - 150 for 1 month vacancy = 1650
Now snow removal and lawn mowing will be done by me for much less money, however I'd still like to factor that in to value my time a little
The question is, if the relatively low cashflow would be enough for routine maintenance, large capital expenditures, longer spells of vacancy and problem tenants.
To me, the idea of buying this property, living in half of it, and collecting $1350 in rent for it, makes a ton more sense than renting a similar place for $1000 a month a few blocks away as I'm currently doing, but I just want to make sure I'm not being unrealistically optimistic.