Might buy First property. Please read, numbers included!

[Shawn D.]

Hello everyone. I really need some help. Here is my situation. I am looking to buy this property and wondering if it's a good investment. This will be my first purchase. It's a two family and I do plan to live there. I have been negotiating with the agent for quite some time. I really do like this properly and all the city has to offer. A family friend owns a bunch of investment properties in this area and they have told me they never have an issue renting. Here are some numbers. Listed at $339,000 dropped to $324,000. I offered $290,000. We met at $310,000. I have a big decision here. I will be doing an first time home buyers FHA 3.5% loan Some things about the property. GREAT location grade A. Right near downtown square lots of shops, restaurants etc. Easy renting. New electrical and heating system. Not much work needed MOSTLY COSMETIC. First floor is bigger which I will rent out and will get @ least 1050-1200 including utilities. I will be living on top floor but when I move out I can get $950-1,000. This property also has two, two door garages (and a buildable lot that is worth $ 90,000-$100,000 that is directly behind the MF house on a different street. (One of garages also has running water which can get converted to another unit - good friend did that to one of his and looked at this garage and said it would be a good idea- so potentially 5 units if I play my cards right.) So essentially, I'm paying $220,000 for the house and potentially build another 2 unit on the other property (in the future) which is the max you can have on that lot according to the town. Problem I'm having is the negative cash flow of course and everything I read and listen to on website and pod on 2% rent etc. I ran the numbers and with PMI, taxes, insurances, and mortgage I will be paying around $2200 a month. I really love the property but don't want to get my emotions involved. Extra info. Recent similar home sales in this area ranged from 235,000 - 300,000. 4 unit on same street sold for $400,000 to an investor (reliable source) Thanks for taking your time to read.