Take a 2nd look please? My first official offer going might be going out today!
I have found a property that is a SFH with a duplex on the same lot. As a LTR all three units, it cash flows $800~, as a straight Airbnb STR (estimated 30% occupancy: 10 nights a month each unit) it cash flows $1937, and as the LTR for the SFH and the duplex STR it cash flows $1300~. I got an agent to send an official offer and he has asked that I get the prequal done- So I am doing that now- I have looked at it and everyway I run the numbers it cash flows great and the CoC starts at 34% at 20% down payment. I am really excited but what am I missing!? I've put in a 70% increase in the taxes just in case, i put $350/month for insurance (hoi + flood) that's the set expenses for LTR options, then for airbnb i added $1760 to $4320 in variable expenses (depending on straight STR or the STR<R mix) please see the analysis below. What else should I be looking at?
How are you comping the value of the property? I ask because if all the structures are on one parcel, you need to be comping it as a triplex, as that is what an appraiser will do. If your interest rate is locked in, then 7% is fine. If not, and this is dependent upon the type of loan you are using, I would use a higher interest rate to be on the safe side.
Quote from @Mark Munson:
How are you comping the value of the property? I ask because if all the structures are on one parcel, you need to be comping it as a triplex, as that is what an appraiser will do. If your interest rate is locked in, then 7% is fine. If not, and this is dependent upon the type of loan you are using, I would use a higher interest rate to be on the safe side.
Hey Mark! I am just used 7% as a standard- this will be my first time getting prequal so i'll put the real numbers in once i get my rates. As far at the comps, its a little difficult. I'm going to ask my agent to get me some but this is the cheapest property for sale right now, there are 3 or so in the $200ks and then they jump up to $400k to 1.3 million just 1-2 miles away.
