Sanity check on my first SF Offer

3 Replies

Hey BP community.  I spent the holidays cramming real estate books, including multiple BP published books.  I spent the better part of the last 2 weeks analyzing deals, and just made my first offer tonight.  I was hoping to get a few eyeballs on it to point out any obvious mistakes I might have made with the analysis, mostly for the learning experience.  Details:

  • House
    • 59,900 asking
    • 53,500 offered, seller pays 5k closing costs
    • 20% down (10.7), 4k in repairs, so 14.7 cash to close
    • Tax assessed at 73k
  • Income:
    • I know this house rented at 950 previously.  I have insight into previous owner, so fairly lucky on that front.  It was section 8. 
  • Expenses: Total $716.11
    • mortgage 240
    • taxes 75
    • insurance 70
    • vacancy 40
    • repairs 75
    • CapEx 141.22
    • property management 75 (doing it myself, just future proofing)

My goal was to find a property that provided $200/mo cashflow and at least 10% CoCROI. I'd be happy to provide more details on how I came up with the CapEx numbers, but I was pretty thorough on all the big ticket stuff and what the costs are for this house in my area (father in law is a contractor), so I'm fairly confident in that one.

Any tips for improving this?  Warnings?  Awards?  

Thanks!

Wow, I can't believe it's been a year since this post!  Update (probably just for myself, but it feels good): 

I didn't end up getting this property. When I didn't, I got cold feet with the cash I had and dumped it into a Roth IRA. I regretted that instantly. While I saved up again to be in position to buy, I read and listened to probably 1000 hours worth of info the next few months.

Nov 2019 I closed on my first BRRRR deal using private money. Rehab completed on budget, getting a tenant in it now. Couldn't have done it without this community and resources.

2020 Goal: 2 more BRRRR deals.