FIRST Rental Property

[Jordan Vanherwynen]

I am NEW to this, I wanted to get quick feedback on this "deal". Do you think this property has potential? 

Thanks

[Elenis Camargo]

@Jordan Vanherwynen I purchased a property for $90,000 in Florida last year and the closing costs were closer to $5,000. Definitely $1,500 seems extremely low. You want to add a good amount to make sure you're not underestimating. I also would never do a deal that gives me $76 in monthly cash flow. I have 3 properties and they have cash flow of $381, $344 and the last one is $250 (which came with tenants and we will rehab next year to sell for a profit). Those cash flows include capex and vacancy. Some things to consider:

• Things break so imagine you are only making $76. It would take you months or years to recoup maintenance issues if something major happens.
• Tenants stop paying, so if you had to evict that's several thousand dollars down the drain. And this WILL happen. It's just a matter of when. We already had one tenant abandon with our first property within 3 months of acquiring it and now our second property the tenant is super late but has been communicating so I'm working with her. They were both inherited tenants so if you place your own tenant you're less likely to have a problem.
• Are you hiring a PM to get you a tenant? Then they charge one month's rent for that. If not then okay you save some money there.
• When your tenants move out, remember you may have a few weeks or couple months of the property sitting empty. Another time where you'll have to invest more money paying the mortgage yourself rather than bringing in income. 

If you have a higher monthly cash flow, it helps ease the issues above. If you want to make this a long term investment and get into rental property investing heavily, then I advise to look for higher cash flowing properties and reconsider your closing cost numbers. Feel free to PM me with anything you need  :)  I'm happy to help! I felt lost a year ago with my first property but after the first one you learn so much that it becomes second hand eventually. Best of luck!