2nd opinion, submitting an offer :)

[Antonio Nguyen]

Hey Guys, I came across a new development Duplex, please see below my results:

Original List Price: $339,900 ($169,950 each)

Purchase Price: $310,000 ($155,000 each)

Each unit has 3BR/3Bath with 1544sqft (total of 6 BR/6Bath)

30 years fixed at 4.5%, 20% down

Gross rent: $3400 ($1700 each unit)

Property Taxes: $1600

-New build so property is built in 2016 and currently still being finished.

-Tenants are paying for utilities

My numbers are showing a 13.5% Cash on Cash ROI and netting about $790 a month in cashflow. I know this may not be your criteria, but assuming it is, are you getting about the same numbers as well?

Any thoughts feedback? Thanks guys!

[Russell Brazil]

@Antonio Nguyen Im assuming this is the property you were txting me about earlier, and I think the numbers look pretty good there. Your capex and repairs are likely to be lower in the first 5-7 years than your estimate due to it being a new construction. A lot of your repairs are actually going to be covered by the home warranty from the builder.  Insurance might be a little bit cheaper too, probably about 900 a year Id estimate. 

I think this looks like a pretty good deal. The only thing I would keep in mind is that in many locations a new construction can actually depreciate in the first decade...if not in nominal terms, then often in real terms. (Real terms meaning if inflation is 3%, the property goes up 1%, meaning it loses value against something going up to match inflation)....however that is not always the case. I can point to areas in our metro area where a new construction will depreciate, and other areas will it will appreciate.

However all that being said, I think this deal looks pretty solid to me.