Updated about 9 years ago on . Most recent reply
Duplex in Ridgefield, NJ - Good Deal?
Hi all,
Hoping an expert on here can provide valuable feedback and advice on a potential investment property purchase. A friend of mine and I are considering purchasing a duplex in Ridgefield, NJ with the following numbers:
| Home | Address | BOA |
| Elementary School Rating | n/a | |
| Max Offer Price ($) | $465,000.00 | |
| Renovation Budget ($) | $- | |
| After Repair Value ($) | $- | |
| Closing Costs (%) | 3.50% | |
| Closing Costs ($) | $16,275.00 | |
| Total Upfront Cost ($) | $36,075.00 | |
| Loan | Purchase Price ($) | $495,000.00 |
| Down Payment (%) | 4% | |
| Loan Points (%) | 0.00% | |
| Amortized Over (years) | 30 | |
| Loan Interest Rate (%) | 3.85% | |
| Down Payment ($) | $19,800.00 | |
| Loan Amount ($) | $475,200.00 | |
| Loan Points ($) | $- | |
| Monthly Mortgage Payment ($) | $2,227.78 | |
| Monthly Misc (HOA, Garbage, etc) ($) | $- | |
| Total Monthly Due ($) | $2,227.78 | |
| Rental | Monthly Income ($) | $4,000.00 |
| Annual Property Taxes ($) | $7,000.00 | |
| Insurance ($) | $1,584.00 | |
| Vacancy (%) | 5% | |
| Cap Ex (major repairs) (%) | 5% | |
| Minor Repairs/Upkeep (%) | 5% | |
| Property Management (%) | 0% | |
| ROI | Annual Rent/Purchase Price (%) | 10.32% |
| Cash on Cash ROI (COCR) (%) | 4.55% | |
| Purchase Cap Rate (%) | 6.10% | |
| Annual Net Operating Income (NOI) ($) | $28,376.00 | |
| Annual CashFlow ($) | $1,642.68 | |
| Monthly Cash Flow ($) | $136.89 |
I would use the BOA Affordable Loan option to purchase the property with only 4% down. The program allows a low down payment with no PMI. The house is listed as 495k on a main boulevard in the town. The property would come with existing tenants with a one year lease for 2200 a month (4 BR/2Bath) which we think is too low. We also intend to airbnb out the finished basement and top floor when I am out of town for work (majority of the time) to hit our target 4000 rental income per month. Does this look reasonable?