Help reviewing a deal, should I cut my losses?
Hello everyone, I was looking for advice on how to proceed on a potential buy & hold property I am looking at. I made a very rookie mistake and got to eager to get a deal done and did not run the full numbers. Now I am looking at the numbers again and I don't know if this property is worth it.
Property is $78,000 I would be putting 25% down, the closing cost would be $3000 and an interest rate of 4.6%. It would need $10K to get it into rental shape where I could ask $950-1050 a month in rent. This is in Richmond, VA
I have already paid a deposit of $1000 on this property but after running the numbers through the calculator on BP and accounting for 10% vacancy, 15% Repair & Cap EX COMBINED and paying for water at $50 this property comes in at 6%-8% cap rate and it seems like it has the potential to be a money pit or at least no returns.
My question is am I being overly cautious or should I cut my losses on this one and back out of the deal? I would rather lose a $1000 than be stuck with a bad property.