First Time buyer Duplex??
Hi!
I'm looking to hold and buy or house hack and am completely new to the whole process. I found a duplex, 2 unit establishment (3 bdr/1 ba and 2 bdr/1ba) with a pretty good location. Asking price is 475,000.
I think I'm having a hard time with the CAP calculation.
With a rent of $5000 ( so above the 1% rule)
Property Taxes/month = 450
Insurance = 67
HOA = 0
P/I = 2223
Management Insurance = 392
Maintenance (5%) = 250
Vacancy (10%) = 500
per month $5000-3882 = 1118 cash flow
Expenses - mortgage every month = 450 +67+392+250+500 = 1,659 x12 = 19,908 per year
Cash flow = $13,416
CAP = in the negative.
Am I doing this calculation all wrong??