Hi @Chris Marshall ,
You should also factor in the cost of vacancy, property management, and large expenses (roof, furnace replacement,...) If you can collect 130% of your monthly bills in rent ($900 x 1.3) then I'd say proceed.
$900/month sounds like a bit for the more rural market you're in (judging from Google Maps), but you can always put it on Craigslist and see how much action you get.
@Nathan Platter yeah my real estate agent I always use thinks 900-950 would be good price range to rent my house. And between the rent coming in from my wife’s salon and the house we would be at 175% of what monthly expenses would be for the property. I was thinking of setting aside $100 for each of those, maintenance, vacancy, and larger problems (is that what cap ex is called?).
Off topic, but why so much for electric? We’re all electric and pay about 10 cents per kw or whatever they measure it in. I never have bills that high. Will renters expect that high of utility bills?
Also, living in a flip while working on it is hard on you and possibly your marriage. Just sayin.
Ahhh gotcha, I must have misread and got the 900 from somewhere else. Yeah, as long as the business model is self-sustaining (which it sounds like it would be, also when factoring for larger repair items) Financially, everything seems OK. Always have 3% of the property value set aside for those big repairs and you should good.
@Marian Smith does make a good point, living in a flip is a not easy. Things, like using the family room as your short-term bedroom and washing your dishes in the bathroom, are not uncommon.
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