Utility bills and possible SFH first investment
Hello,
Have a question about a property that I am currently under contract with. I have been researching quite a bit on buying this property in Durham, NC while we are waiting on inspection next week. And I'm not sure if I've just gotten a bit of nerves or is this an issue. The property is a 3 br, 2full bath, 1500 sq ft' sfh. It is on almost .3 acre in town. It is on a nice block in a questionable neighborhood ( Orange on the Trulia crime graph). Currently have it contracted for 58k, tax value is 97k. Sold in 2008 for 85k.
I was planning on 20% down and financing at 4.875 the remaining.I have estimated a 8-9K rehab.This gives me some leeway and was leaning towards a property management company on this one, due to the area and being my first REI. After speaking with them, due to the neighborhood, they figured on a soft quote of 875 / month rent and 11-12% fee.
I was checking the utilities out and was a bit overwhelmed by the average electric bill, Central and forced HA; of 450 /m in 2013 and 376 currently with a winter month high of $600. That seems quite high to me, for several reasons. But mainly that this property is going to garner the very lowest of the financial ladder, but not even the middle. If their utilities are going to be that high, are they going to pay their rent? Maybe I'm overthinking this. The utility has stated that the landlord is not responsible for past due bills.
Anyway....this may have been more of a rant or my way of getting my thoughts out and written, which always helps me. But any input would be greatly appreciated. Maybe this buy and hold really needs to be a resale........
Peace