Can Someone help me analize a potential offer?
I live and plan to invest in the northeast, but I've been to Florida recently and I love it there, I would love to buy a place in the Tampa Bay area, as a rental investment for now, with plans of maybe moving there in the next three years. the property I'm looking at is a SFH, and Im thinking of offering 25 thousand dollars less than what the asking price is.
The problem I see is that when I put the deal in the Rental calculator, my Cash on cash return is 8.5% and I honestly want to stick to at least 15% cash on cash return, so that my money can sleep well at night. Am I being unreasonable in expecting those kinds of returns in that area, or is my offer to high? I am calculating an 8% vacancy rate a 10 percent management fee, a 10% capital expenditure, 2% increase in value and a 7% sales cost. Am I missing something?