Is this property a good deal?

Question

I found this multifamily property in Phoenix Arizona that has 4 bedrooms and 4 bathrooms across 2 units, I ran the numbers on this deal while watching a Biggerpockets Webinar about how to start building wealth through real estate by David Greene, but I am still a little bit unsure about the numbers, and still don't know much about real estate, so, is this a good deal or a bad deal?

Chad McMahan · Answer

Jose,

if you want to increase the odds your transaction will be successful, lean on your realtor for this. If you don't have a local realtor, get a REALLY GOOD ONE. I'd discourage asking on BP about specific deals. We don't know your areas- we have not confirmed your figures. It's very loosy goosy and high risk to your success.

Buying with a realtor is such a no-brainer. The seller pays their commission.

Trever C Trader · Answer

A calculation is only as good as the data that is entered. That said, if your numbers are accurate, I would consider purchasing this property. Especially if it is in an area with Airbnb demand. If you are new to real estate then I would house hack the property. You could purchase that property for as little as $20k out of pocket.

My only issue with this is your ARV. How did you arrive at $425,000? If this property can have $75k added value from $5k repairs then I would absolutely consider buying this duplex.

Jake Kain · Answer

@Jose Lopez I would be happy to give some more insight. I am in the Phoenix market and have lived here my entire life. I work with a lot of newer investors looking to buy small multifamily. Feel free to PM me.

Jose Lopez · Answer

@Bud Gaffney do you want the address?

Bud Gaffney · Answer

That's a buy.

Alexander Felice · Answer

More important than the numbers is the area and the ground team.

A great deal on paper in an area that a property manager won't go near is no deal at all, and it happens quite often. If it's such a great deal why have all the locals passed on it? Who exactly is going to manage it and what is that going to cost you? Do they think it'll generate the rents you are predicting? What kind of tenants does this place attract? What is the total rehab and has that been confirmed by a local contractor? Will that contractor actually show up to do the work for the agreed upon price?

Might be a great deal, but these are questions that would have to be answered before anyone can tell if it's a good deal.

OOS investing is a great opportunity to make money but comes with a myriad of pitfalls, the numbers are the easiest part, it's the data that people don't have or consider that sinks them.

Deonte Brown · Answer

@Jose Lopez Check your PM.

Is this property a good deal?

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