Updated over 8 years ago on . Most recent reply
Seeking Advice.....First Rental property in Erie County, PA.
Hello, I am in the process of analyzing local investment properties and want to take the dive into land-lording/ownership. I find myself experiencing analysis/paralysis since analytics is very conducive to my personality. Fortunately, my resources in terms of a contractor(s), H VAC, plumbing, property appraiser, and home inspector are close family friends. My uncle has been sending me investment properties and potential flips from the MLS. What I am really trying to get at is how do you know when a deal is the right deal; don't want the first one to be a disaster. Below is one specific property I analyzed but still need to do a walk through along with an inspection.
- Asking 40K with an appraised value of 52k
- 100 occupied
- 2 unites that rent for a total of 1100 per month
- After using the rental property calculator on Bigger Pockets the cap rate was 10.5%, Cash on Cash return of 25.5% with 10% down
- Roughly a net of $125 per door
- Accounted for 3,000 for repairs but will do a final walk through with my GC in the coming week
- I may be relocating so have factored in $105 per month in property management if need be
Does anyone have experience within this market? I understand the rust belt offers inexpensive properties and that is one of the reasons I feel pushed to make my first purchase in this area. I am open as well to any advice and constructive criticism.