Finding my first deal
Hi, my name is Steve Lyons and I would not consider myself a real estate investor yet though I am hoping to get started in the very near future. The issue I am currently having is how to determine what is and what is not a good deal for a buy and hold property. I have been listening to the BP podcasts and it seems there are several different avenues. I have heard some say cash flow is the determining factor while others say cash on cash return. My realtor found me what she felt was a decent property for cash flow purposes though after taking the 50% rule into consideration it just didn't look that good. However, based on the cash on cash return (if I understand the term correctly) seems very good. Any advice on what may be a better determining factor would be very appreciated. Also if there are any investors looking to mentor a newbie in the Brandon/Tampa, Fl area I would love to meet and speak with you. Just as an example, below is the deal that presented to me. Thank you in advance.
Buy and Hold
Town home
3/2.5
1547 sf
Purchase price 78500
Down Payment 15700
Interest rate 7%
Closing costs 2%
Rent 1050
HOA 240 a month
Taxes 1750
Homeowners Insurance - Not sure, guesstimated around 500 a year
Rehab cost - Realtor says property is in very good condition and ready to rent though I have not seen it
My estimated cash flow is approimatly $100 a month