I have found another deal that is a bit outside of my comfort zone for two reasons:  1.  It is outside of the market I know.  2.  It is one price for two properties.  I will break down the numbers now:

1 SFH renting at $700/mo. 1 4 unit multi-family renting at a combined $1850/mo. Total income is $2550. Properties are in the same general area. They are located in Kansas City, MO. Seller is asking $85,000 for both and is not willing to take less or finance.

Calculated expenditures are as follows (some as stated by seller, some confirmed):

Mortgage (80%):  $448.77/mo for 20 years at 5%.  (calculated by me)

Taxes:  $116/mo (confirmed)

Insurance:  $54/mo (stated by seller)

Water/Sewer:  $200/mo (stated by seller)

Seller gave some estimates of maintenance and vacancy that seemed low, so I replaced all other expenditures with 10% of rents to be safe, as shown below:

Repairs:  $255/mo

Management:  $255/mo

CapEx: $255/mo

Vacancy:  $255/mo

Total expenses:  $1390/mo

Total cashflow:  $711.23/mo

I have talked to the seller and the only thing he worried about is getting the $85,000, not financing, and taxes.  He is willing to work with me on other terms to make the deal happen.  He is selling due to divorce.

I still need to talk to banks to find out how to structure the deal in order to get a mortgage that makes sense.  The down payment will be gifted to me from my father, with no expectation of return (other than that I better take good care of him when he becomes elderly).

A couple of areas of concern:  I have been talking to realtors and property managers to get an idea of the neighborhood.  Most have told me that the area is low-middle income and it is not a bad neighborhood.  So, I pretty much have to trust that, right?  Are there other ways of investigating from afar?  I plan to take a 1-day trip there (I am 3 hours from KC) to look at the property and the area, but that may not tell me everything I need to know either.

One of the properties (the multi-family) is listed with an agent now.  Is that going to cause any problems making this deal happen?  Anything we can do to alleviate those problems?

Another issue I see is that while the combined price is high enough for a mortgage, when you split that price between two places, neither becomes something most banks will loan on.  Will that be an issue?  Should I pay a lot for one property and much less for the other?  How can this deal be structured to make it work in that regard?

I think this is a great deal and would really like to see it go through.  I think this one will work as long as the banks will be willing to loan.  The pictures of the places make them look nice and well maintained, but I won't know until I have seen it in-person and had property inspection.

Thank you so much for taking a look at yet another deal.  Hopefully this will be the last one for a couple of years while I build funds to buy the next place.