Offer accepted on SFH Hammond, IN, but should I bail?
Hi! I'm kinda panicking as I always do when making final decisions. Would so grateful for your thoughts on an offer of mine that was accepted on an out of state SFH. Getting cold feet and not sure if I should back out. I know that everyone has a different risk profile but I see conflicting reviews about the area being a C neighborhood, with crime and Hammond being known for "chasing our landlords". I'm not thrilled about a few things on second thought. Here are the stats:
109,900, new lease starting next month @$1195 per month, taxes $2000
3 bd/1 bath, 860 square ft, large fenced in lot @ 173rd and chestnut, between Colombia center and Purdue U.
Rehabbed foreclosure, 1955
New hvac, New roof, 1 year home warranty paid by seller
Initial expenses about $6000 for:
Appliances ( no stove or fridge)
AC (duct work in place but no central unit)
$130 monthly cash flow
6.29 cap rate
COC 5.2%
(Vacancy , 8.5%, capex, 8%,Management 10.5%, maintenance/repairs 8%)
I’ll be taking a mortgage out on it. I know it’s not a deal but am I overpaying? Comps seem to be from $98k-$120. Should I run? Not happy with having to put in appliances and the AC which was promised to the tenants.
I’m also thinking about the future and an exit strategy which I believe is important. Neighborhood may not have much appreciation and the curb appeal is just ok. Would likely go to an investor rather than a family if all things remain the same in 10-20 years. Wondering if selling would be tough ( of course can’t predict the future)
THANK YOU SO MUCH I’m advance for responding to this nervous nelly.