Deal Analysis

2 Replies

Hey all,

I am considering making an offer on my first deal, which is a duplex.  Currently has 2 tenants, plumbing has been replaced, new counter-tops in both kitchens and new tile.  I haven't had the place inspected yet or anything but here are my calculations, please let me know if it looks good or not worth it.

Purchase Price120,000.00
Down Payment12,000.00
Rehab Cost5,000.00 (estimating this just in case)
All In Total17,000.00
Rent1,400.00
Tax166.00
Insurance100.00
Management140.00
Vacancy 7%98.00
Repair 5%70.00
Mortgage550.00
HOA0.00
PMI50.00
Water40.00
Total Expenses1,214.00
Cash Flow186.00
Cash on Cash13.13%

Sorry about that, pasting from a spreadsheet apparently does not work.

Purchase Price 120,000.00

Down Payment 12,000.00

Rehab Cost 5,000.00

All In Total 17,000.00

Rent 1,400.00

Tax 166.00

Insurance 100.00

Management 140.00

Vacancy 7% 98.00

Repair 5% 70.00

Mortgage 550.00

HOA 0.00

PMI 50.00

Water 40.00

Total Expenses 1,214.00

Cash Flow 186.00

Cash on Cash 13.13%

Right off the top of my head ... How old is the Duplex? Depending on the age, I think you want to put aside more money, just in case lots more work needs to be done in the very near future.  The rent price compare to purchase price is really very good.

How long are the leases of the tenants? Depending if they might be leaving soon, you should consider some $ for recruiting the next tenant as well. How expensive are similar houses in the area?