I'm looking at a 3 bedroom 3 bath 2000 sqft home in a rural area. I can pick it up for 28,000 and brings in $525/month. The current tenants have only been there 2 months. It needs nothing done. Central hvac, good roof and flooring. Taxes $500/yr and insurance $600.
@Robert Peacock Taking in your expenses, accounting for vacancy, and depending on how you are financing this, are you cash flowing on this deal? If you are, then it's a good purchase.
Sounds like it could be worth pursuing. You will get higher rent towards the cities though and houses are not necessarily more expensive.
Seems like a good deal to me.
Wow, is the $525 for a 2000 sq ft, even in a rural area, in line with the current market rents? Even if a town of 500 people that still seems very cheap for such a large house. Even if you buy the property and have to assume the existing lease (likely for 10 more months) is there any opportunity to increase the rent once the lease expires?
I did a quick Zillow search and see a lot of houses for sale for pretty cheap, and it looks like the average income of the city is below $30k.
I still say that return is a decent deal for some cash flow.
Are those good tenants and does it rent well out there? Check out the rentals around the area first.
Save ALL your cash flow. It will be needed for repair, maintenance, and selling cost. How will you make ANY profit on this?
Don't forget to try running it thru the bigger pockets calculator!
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