Calculating your investment

[Marcell Salmond]

Good morning everyone. Last year this time I settled on my 1 st property. House hacking a duplex. I bought it at 257k. They wanted 272k but it appraised at 257kand they didn't wanna come down at all. I wasn't really concerned about it because I really wanted the property. My question to you all is how do I calculate if I made a good investment? What's that formula? Here's my current numbers: Mortgage = $1689.72 Unit I'm currently renting is $1100(I was told I could get at least 1300 but I haven't made any increases yet)+ $50 for water. I'm staying in the bottom unit which was last rented for $900. Now at current rent and if I rented out the bottom unit it would cover my mortgage plus put money in my pocket but where I get confused is how much to take out for repairs and whatever else. 1100+900=2000$ giving me $389 afterwards. Any advice or knowledge would be greatly appreciated and I apologize for the short novel lol.

[Barry H.]

MARCELL - I have been a REI for 13 years (SFHs and a 4-Plex in my past). $5K ROI on a $275K property is low (2% or so). It is positive, so that's great, and if you enjoy living there, you are ahead of 95% of the general public in living in a place that pretty much pays for itself. That said, if you can put another $10K into it and get your rents up to $1300 top and bottom, now you are cookin with a competitive 5-7% ROI.