Updated almost 4 years ago on . Most recent reply
Would you buy this 12 unit deal?
Would you buy this deal?
I'm located in WV.
12 unit fully occupied (6 storage buildings on the property as well).
4 units are 2 bedroom 1.5 bath, 8 units are 2 bedroom 1 bath
Location for this area is B+/A-
Total rental income monthly: $7180
Purchase Price: 650,000
Seller concession: $55,000 back at closing to give seller 595,000 and to give us money back for 2 new roofs and rainy day fund for future capex.
Gross Monthly Rent: 7180
Mortgage: (3204/mo) 15% DP on 650,000
Taxes: (834/mo) (currently 9000ish but I bumped up to 10,000/yr to be safe)
Insurance: (333/mo) (currently 3000ish I bumped up to 4000/yr)
Miscellaneous: (250/mo)
Total expenses: (4621)
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Cash flow per month: roughly $2500
Per year: roughly $30,000 year
Down payment: $97,500 (half my own money half my dads money, want to get him paid back as quickly as possible and if he weren’t my dad I would plan to pay him 10-15% annualized for the loan. He is happy to do it for free and I am grateful.)
Total out of pocket: $48,750
Annual cash flow: roughly $30,000
Units were built in 1993, all have HVAC's, rents are $600 for 4 units and $575 for 8 units. Market rent for a 2 bedroom in this area is $650 conservatively. Also 6 storage units on property that generate additional $180/mo.
LOAN: 5/1 ARM, 3.5% interest, 15% down payment, 20 year Am
This will be my first multifamily acquistion, I am under contract with the seller and planning to review financials this week and then tour the units after the first of the year. Any tips would be appreciated.