Bad Deal?
I have a potential deal with a seller that has a 3 BR 1 Bath ranch in Roseville MI. The house is 1050 sq ft, sits on a crawl and has no garage. It was built in 2004 in an area where most houses were built in the 1950s. The overall area is predicted to appreciate at a rate of 4.2% in 2016 and this property may appreciate above the market prediction. The house is very clean and only needs about $3000 in maintenance. Its currently tenanted at $850 per month and is scheduled for a rate increase to $900 in the fall. The seller has a current mortgage balance of $80,000 and is only looking to get out of the mortgage. His current payments are around $800 based on the mortgage he took out in 2004. This looks like it may work for a buy and hold scenario (cash flow and appreciation), if the property could be bought with a 30 year fixed mortgage, 7% or less interest rate, and a 10-20% down payment. Based on this scenario, any recommendations?