is this a good first deal?

Question

Having trouble finding a small multi in the area I want to live. Been looking at this one and here are the numbers. Keep in mind this will be my first property, so I'm looking at this as an opportunity to learn and create systems.
Duplex top 1 bed 1 bath, bottom 2 bed one bath. New roof newer furnaces and electrical.
Purchase price 107000
Estimated rents total 1425
Taxes: 2800
Insurance: 80 per month
Water/sewage estimate: 200 per month
Garbage estimate: 20 per month
Pmi:73
Gas/electric paid by tenants.
Vacancy 5 percent:71.25
Maintenance 5 percent:71.25
Cap ex 8 percent:114
Cash flow:$84
The rents are estimated because it was used as an in-law suite. I will be using FHA loan 3.5 down and seller paying closing costs. Property is located 10 miles east of Pittsburgh Pennsylvania.

Brent Coombs · Answer

@Bill E., with YOU being one of the "tenants" paying gas/electric (and with a $500+/m principal and interest payment), there'll be no cash flow. Even if/when you move out, it'll still struggle.

If you can't get into this one cheaper than renting, I suggest: keep looking for better value.

There's no reason why you should WASTE the "opportunity to learn and create systems" on a poor deal. Your "first property" should STILL be a bargain in its market!

How about Foreclosures; Sherriffs Sales; Zombie homes (203k loan) and the like? Cheers...

Bill E. · Answer

Oh and monthly mortgage payment would be 850. That's WITH PITI