Looking at my first buy and hold property - MO
Hi Everyone,
I'm going to check out a property here in Missouri tomorrow morning. It's a duplex in a C neighborhood.
Asking Price is $69,000. I'll be asking for less but for analyzing, I'll stick with the $69k.
I'll put 20% down. Financing $55,200. Assuming 4% interest.
It's currently renting at $1,000 gross. One side is section 8. The current lease is through Oct of 2016.
Taxes were $888 in 2014. I'm not sure what the insurance will be yet but I've put in a request from my agent. For now, I'll assume $1,200 a year.
I'll account for 10% monthly for vacancy and 5% for cap expenses. The property has a new roof, new floors, new HVAC, new water heaters and new windows. The seller is having health issues and is selling his properties.
So to summarize:
Loan Amount: $55,200
Interest Rate: 4% (assumption)
Principal & Interest: $263.53
Taxes: $74/per month (2014)
Insurance: $100 (assumption)
Vacancy: $100
Cap Exp: $50
Total Expenses: $587.53
Total Rent: $1,000
Cash Flow: $412.47
Cash on Cash ROI: 35.87%
So what do you guys think? What else should I be considering?
Thanks,
Brandon