The snow is starting to fly here in the Northeast and I'm trapped in doors for the next 24 hours.
With the free time I thought it a good chance to get reassurance that my current deal is a good one.
I bought a 2 family about 15 years for $120k, remodeled it slowly and rented it steadily for 10 years. It's been a cash cow and I paid the property off a few years back. I get $2400 positive cash flow per month and could easily get more.
So, Ive been a landlord for a ong time and no the ins and outs.
I took out a home equity line of credit on it and purchased a bank owned 2 family for 180k a few months back. This needed a fair amount of work but is in a good town with lots of high end properties. My house is on the bad side of town because the surrounding houses are smaller don't go for over a million. Remodel costs will be $90k (all out of pocket) when all said and done, more than I estimated but this goes with bank owned properties.
When finished it would sell for approximately $399k (smaller lot, bad side of town, no water view).
I just rented first unit for$1500/month and expect to get same for second unit next month. I was planning on refinancing and paying the equity line off and taking back the out of pocket remodel costs ($250k note). I do however need to wait the six months to refi. I will not have any management costs (I can handle all maintenance calls). Taxes and insurance will be $350/month.
Would you have made the same deal?