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Real Estate Deal Analysis & Advice

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Brandon Heath
  • San Diego, CA
10
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78
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Im pretty sure this is a horrible deal, just help me to understand why

Brandon Heath
  • San Diego, CA
Posted Sep 3 2014, 00:36

Hello BP!

First of all I am an EXTREME newb to any type of investing, so I apologize in advance for all the needless questions. I live in San Diego county and would like to try and purchase a small multi family in the next 12 months. I've been looking around and trying to get a grasp at maybe what I could be getting myself into. This property is just down the street from me and I cant get it off of my mind (dangerous emotion). So I thought it would be great to run numbers with all of you. I find myself trying to act like this would work and your job it to crush my dreams and save me from myself. 

The property is in Poway California, here is a link to the actual listing Click here. 

  • Ranch Style Duplex
  • Side by side 2/1
  • Asking price $525,000
  • Current Rent $1,500 and $1,600
  • Rent Comps in the nearby area are $1400-$1600
  • Metered separately for water and electric
  • Taxes last year $3200
  • I would plan to live owner occupant for a few years.
Now I'm almost positive that from this I see why everyone complains about investing in California. With these numbers I would have to put like 30% down just for it to make sense. I of course would looking for an FHA loan but with these numbers that's basically suicide!  Highly unlikely I would be ready for this deal anyways but i thought it would be great to learn what type of numbers I should be looking for. 

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