Should I purchase this property?

Question

I have a house under contract for $165,000 with an appraised value of $169,000. Its tenant occupied collecting $1300/month. My mortgage would be $950/month and my cash invested would be $37,000. Is this something I should invest in or should I cut my loses and look for a more ideal property? Thoughts?

Bjorn Ahlblad · Answer

@Cory Peters I would definitely let it go if you are buying and holding; there is no money to be made.

Matt M. · Answer

@Cory Peters

Just out of curiosity, what made you think this would be a good investment?

Brent Paul · Answer

Are there improvements you can do to raise the value?  I agree there isn't much meat on the bones here in terms of equity.  Without knowing all the numbers it's hard to say.  Keep your eyes and ears open for other properties.

Kate Johnston · Answer

Without details on the expenses we can't give you a complete analysis, but estimating that expenses will be at least $500/m and adding that to the mortgage, this property doesn't cash flow.  Unless you can raise rents to put yourself in the black or add value and resell, there are better deals out there.

Herndon Davis · Answer

Too little information to tell.  Try using the BRRR calculator

Should I purchase this property?

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