Duplex in Brevard County Florida
My wife and I are planning for our first rental purchase and I came across one of the few duplexes in my area that isn't either over priced a scary sight. I am doing my best to do a good analysis on the property. I did the below analysis just for practice, in order to get me into the habit. Below are some details:
Asking price is $125k, but I am working numbers for $100k, which is what I would want to pay, just as an exercise.
Rooms are currently rented. Gross rent is $1450 per month ($625 for one unit/$825 for the other).
Taxes: $1280
Insurance: $1400
Operating expenses: $725 (Accounting for 50% of rent)
| Mortgage | 380 |
| PMI | 0 |
| Insurance | 116 |
| Taxes | 106 |
| Vacancy | 35 |
| Maintenance | 725 |
| Total Expense | $1,362 |
| Income | |
| Monthly Rent | $1,450 |
| Annual Rent | $17,400 |
| Cash Flow | |
| Monthly Cash Flow | $88 |
| Annual Cash Flow | $1,056 |
I understand that most target $100 per door, and that would be my goal as well. I just wanted to get my first deal analysis out for review and feedback from those who have done it. It is unlikely that we are ready to purchase our first property, or that we would be able to negotiate such a discount; however, I am doing exercises to ensure that I am familiarizing myself with the process.
One thing about this duplex. It is a very small duplex, with one unit on each side. I like it because its small size makes it not much to look after and is currently being rented by tenants and the owners have owned it for a while. I believe that the owners are older and ready to be done with rentals. Overall condition looks good, although I am sure there would need to be fixes.
Thoughts?