Newbie I have a question as to what to do and if this is a good deal or not. Here are the details: For sale by owner 4-plex 3-2’s 1/2 acre 3 rented out $750.00 one vancant. Bring in 3k month. Asking price 285k. Not listed with a realtor no contract on property. Apparently needs no repairs. Although I have not did an inspection or appraisal on property. The owner is moving out of town. This will be my frist deal who would need lending. Should I go ahead with this deal? What wolud be the steps to take to get this property under contract? Help!!!
Hi,
Let's take the basics and see what we find?
This is an example only and has no factual basis!!!
Vacancy Factor - 10% = $300
Property Management - 10% = $300
Common Electric - $45
Landscape Maintence - $80
Insurance - $65
Property Tax - $100
Trash Service - $100
Water Service - $160
Legal Fee’s & Cost’s - $20
Advertising & Marketing - $20
Maintence - $25
Repairs & Reserve $270
Total Expenses - $1485
Now when you figure your principle and interest!
Purchase Price - $256,500
Closing Cost - $5130
Loan Fee’s & Cost’s - $2565
Total Cost - 264,195
Down Payment - 20% - $52,839
New 1st Trust Deed - $211,356
30 Years @ 5.75% = $1243.42
$3000 Total Potential Income
$1485 Expenses
$1243
$2728
$272 Possible Monthly Positive Cash Flow!!
This could be a good investment? You need to run your numbers just like I ran this example!
Good Luck,
GR