Bought First Investment Property with success!
My husband & I decided to get into real estate investing last summer and purchased our first investment property in SW Florida a few months ago for roughly 20% below market value. Seems like we decided to invest, found a property & bought it pretty quickly which is exciting.
The property was a foreclosure---a 3 BR+den/2 bath condo which was in great condition. The bank had painted & installed new carpet. We needed to add appliances, blinds (for windows) and have a few very minor repairs. We passed on 2 potentially ok tenants in favor of getting one we felt more solid about and now have one who has the potential to be with us for several years.
- Monthly Rent: $1,700
- PITI: $809
- Property Management: $221 (13%--I feel this is high & an opportunity to reduce this expense)
- Vacancy Rate: $119 (7%--this is based on our initial vacancy so I think it's high, but I'm using 7% to have a safety margin of error.. I have questions about the fluctuation of this over time and how it effects the numbers overall.)
- HOA & projected maintenance/ongoing repairs are another 11%-ish.
- Cash Flow: $363
Overall, I'm feeling really good about this purchase & it's potential. Our equity position is strong & I'm pleased with the cash flow knowing that I've been conservative with the expense projections which means our cash flow is probably slightly better than stated.
We're now closing in our next purchase, although I feel like I want and need to learn a lot more about creative financing & getting investors because at some point we won't be able to continue making purchases with standard mortgages using our own out of pocket dollars! Even with all the info here on BP, I'm a little uncertain as to how to actually progress with taking action on from this standpoint.