Author Topic: Thinking about buy another rental.  (Read 1074 times)

b4u2

  • Pencil Stache
  • ****
  • Posts: 630
  • Age: 41
  • Location: Cedar Rapids, IA
Thinking about buy another rental.
« on: November 09, 2016, 09:43:40 AM »
The bug has bitten me once again. I am looking into another rental but still not sure if the timing is right. The price on the rental I am looking at fits since I "could" come up with the 20% down. The seller has not signed with a realtor yet so I can save on overall price. I can also cut a little more off if I finish the work he is doing. New kitchen sub floor and flooring, new carpet in two bedrooms, other small misc work to finish off. The price seems good and the market for a rental in that range (650-800) seems fairly strong here.

Current asking price $67,000 Might be able to get him down to $63,000
$13,000 @ 4.5% for 60 months $242.08 loan for the 20% down from 401k
$50,200 @ 4.5% for 30 years $254
Property taxes $1300?
Insurance $700
Maint $1000
Vacancy ???
Total $434 PITIM + 242 20% loan= $676

My other rental is valued at $120k and we owe 88k but I have no idea if we could use that equity to help fund a new rental.

We purchased the property Mid May of 2014.  The bathroom had been updated before we purchased the house.

After the purchase we did the following to the property:

Replace the duct work and furnace with a high efficiency furnace and central air.
Replace all the galvanized water pipes with Pex.
Replace the gas hot water heater with a new electric hot water heater
Upgraded the fuse panel to a new circuit breaker panel and updated a lot of wiring.
Purchased a new Refrigerator and Washing Machine.  The Dryer is a used unit but works fine.
 A new electric garage door opener was installed.
Newer windows in all the main floor rooms as well.

If I let him do the work I would still get a discount since no realtor and all I would need to do is find a tenant to move in. I would start advertising with rent at $750