I would like to get into property ownership and have a potential deal that I'd like some feedback on.
Property is SFH that is occupied and renting at $650 / month
Owner is asking $35K.
Taxes are $800 / yr and insurance would be about $500 / yr.
I'm told that the roof was replaced about 12 years ago.
The seller might be willing to take a second for downpayment if I purchased at full price.
Does this sound like a reasonable deal or would you keep looking?
Any feedback / thoughts appreciated.
I would look into finding an consulting with an experienced local agent. Hire the agent to do you a Broker Price Opinion(BPO). Instead of paying for an appraisal that will run you a couple of hundred dollars a BPO can run you $30-60. Another term is comparables. Some agents may do it for you for free. Don't rely on Zillows(ever). Then ask the agent for a rental comps as well. This will give a birdseye view of what the rents that are going for based on apple to apples in the immediate area. Run the info on hand through an ROI calculator , then use your better judgement to make a better informed decision. On the surface it sounds good but you would want to protect your self at all points. Do a home inspection, get a title report and make the sale contingent and subject to. Good luck.
Carlos - great information. That was the first I'd heard of a BPO. I would have ended up hiring an appraiser and overspent for the information; thanks for the advice. I'll also need to get a professional's take on the local rents - I was told by the agent what the current rent is, but I need an outside source to validate that the amount claimed is accurate / possible if I were to close.
Thanks again for your help.
General tip: never believe the sellers' info on what the rent is. :)
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