Here are the numbers. Please let me know if you think its worth getting into. I cant decide.
Price: 365K. I have 25% for the down. My partner is getting a conventional loan for the rest at 4.5%
3 Br unit - rent $2000
1 br units(2 nos) rent $1200 each
2 car garage and 6 car parks -could fetch an additional 500 in rent.
Roof needs work. Down the line I'm thinking it may take 25-30K to paint, fix windows etc.
water and sewage expenses -2500 per year. Tenants pay utilities.
Should I go for it or let it pass? What do you think?
@Jason D. - Sorry I forgot to mention -The taxes are close to 10K. Insurance -1500.
Condition -Roof needs fixing -right now can do it for under a 1000$ but in a couple of years it would need to be changed. About 6 windows will need replacing in a couple of years too . Thats why I factored in 25-30 K expenses in 2 years . Age -1920- but in North Jersey almost every house is old .
@Fahima Hilal Hey, I Pm'd you. The deal doesn't seem too bad if you do the necessary things to it... as a buy and hold, I wouldn't take it because your cash flow would be very small relative to your investment and you have to incorporate a vacancy rate and all the expenses associated with the property (not only reserves for repairs)...
@Fahima Hilal Was this for a house hack or brrr? and did you end up making an offer or did you pass?
@Mark Y. I got it under contract for buy and hold. I did the comps -there is no 3-family in this price , in the area. And there is hardly any vacancy around here. So I decided to take it even if I need to do a bit of repairs down the road, as there is instant equity. I already had 2 people who wanted to buy it from me and I havent even closed on it yet..
Assuming the purpose of your purchase is cash flow, I would pass. Remember to take into account any trash fees, vacancy and property management fees.
General rule of thumb is your monthly rent should be at least 1% of your purchase price.
I own properties (college rentals) in neighborhoods adjacent to UC... that purchase price seems high to make #s work... the $500/mo parking doesn't seem realistic for the area unless you can bake into the rent.... off the top of my head those numbers seem a little tight... unless you can really juice the garage for $.