Up / Down Duplex on market.
2bd / 1 bath units
Purchase price: $255k
25% downpayment = $63,750 @ 4.25% 30 year fixed
Closing costs: $2,500
Improvements: $0
Monthly rent: $2700
P&I: $941
Taxes: $185
Insurance: $91
Management: $243
10% vacancy: $270
CapEx: $262
Utilities: $300
Lawn and snow: $0
Expenses total: $2293
Cashflow: $407/month
Cash on Cash Annualized ROI: 7.37%
Other factors:
We've bought two primary home, but this is our first true investment property, so I'm new to this...
I believe this would classify as a C+ to B- neighborhood... Its really a fantastic neighborhood (most desirable in the area) but the unit is literally on the last street of the neighborhood, and across the street becomes commercial properties.
The rental values seem a little high to me, but supposedly they are what the unit has been getting thus far. I check against craigslist, rentometer, and zillow and think it might be prudent to lower the rent assumption to $2,500 instead of using the listed rent values for the property. Thoughts?
This is in my husbands home town, which we will be moving back to in 2023. His mother would most likely manage the units until then when I will manage the units (see breakdown below).
List price is $265K, I would like to get it for lower than the $255K I have listed above (closer to $235K-$240K), but from what I understand of the market, I most likely wouldn't be able to.
I plan on self managing in 2024, so cashflow would increase:
Rent: $2922
Expenses: $2140
Cashflow: $782/month
Annual ROI: 14.17%
Please give me all the harsh feedback... I would appreciate any feedback. Again, this would be our first investment property purchase, so I'm sure I'm missing quite a bit.