aprx value is 85k. purchase price is 35k. I will pay cash… then turn and refi at 50k. 30yr at 6.5% which makes pmt aprx $316 plus another 200 for hoa and Tax, my payments would be aprx $516. rent aprx $700 per month… my idea is I get 15k out,(pre tax) and still get aprx $200 month cash flow… good idea to do. or should I not touch equity… b/c i am cash flowing I plan on holding long term…its hard to cash flow these days… please grade…
How do you plan on having a payment of $516 a month (PIT and HOA only), getting $700 rent, and having a PCF of $200?
Keith
It looks to me like this property will lose about $166 per month.
Good Luck,
Mike
Did I miss something or mis calculate.
loan amt.
50k
$700 Rent
minus
316 (PI)
$200 (Tax HOA)
$516 (total monthly payment)
total cash flow of
$184 monthly
and i have $15k to invest…
am i missing something.
propertymanager.
I see you are using the 50% rule…
so do you think is it a bad investment if it is long term, also, should I just not pull out cash and finance at $35k… my idea was to make it as sec 8 house… I guess from the naked eye it seems like a good deal. I thought the 50% rule was for multi family homes.
please educate…
Thanks…
You missed a ton!
What about:
- Insurance
- Maintenance
- Management
- Vacancy
- Advertising
- Utilities
- Miscellaneous (trash, show removal, legal, etc.)
- Etc…
Keith
it looks like this property would produce about 10% return on your cash investment net of expenses. However, if you can buy for $35k and its really worth $85k, this property perhaps better utilized as a flip (make $25-30k net of expenses and taxes and move on to the next deal)