Would this be a good Buy for a Newbie
My Strategy is Buy and Hold a Duplex in which I plan to live in one and rent the other (if I can afford it); and my niche is an area within 50 miles from O'Hare International Airport, Chicago, IL. It took me months before I found a property which satisfy my criteria. The property is at Tinley Park, IL. It has 3 beds and 2 baths on the second floor, 5 beds and 2 baths on the first floor which is duplex to the basement. Total square footage is 2,770, sitting on a 5,095 sq ft lot. It was built in 1979. It has an 8 year old roof. Current owner pays $167/ month for insurance, $100/month for water and $55 per month for scavenger. Rent total is $2,850. The list price is 250K and I offered 210K which the owner accepted. This is a short sale and according to my agent it will take for the bank to decide 3-6 months if they gave it to me or not. I'm going to send the escrow money today but I have a lot of doubts;
1. My rental property calculation shows that at $210,000 purchase and 15% down, the Monthly cash flow is -$94.73 and Cash on Cash ROI is -2.64%. On the other hand, at 20% down, the Monthly cash flow is $76.64 and Cash on Cash ROI is 1.72%.
2. The seller seems to agree with my offer so quickly.
3. Although the Duplex is just 37 minutes away from work, it would take me one hour and 15 minutes to travel per google maps.
4. I started investing without a team; real estate agent, inspector and attorney. So I have to look for an attorney and inspector today since we signed the offer agreement last July 15, 2017 and because my coworker told me not to hire the ones my agent recommended.
So, should I buy this property or not? Your advise is highly appreciated.