Advice of 1st Investment property
Hi all!
I'm trying not to get caught in the infamous real estate purgatory with the analysis paralysis situation.
I have found a property which I think is an excellent deal. I need advice on funding the deal.
I currently have limited funds (due to the Dave Ramsey pay off debt snowball), so it's making closing this deal a little more difficult.
Here is the deal
Tri-Plex – 11.8% CAP Rate – 20.56% COC ROI
Purchase Price $105,000 ($2,000 non refundable deposit to secure this property)
Current Gross Rents = $1925/month
Expenses = $8328 (Taxes, Insurance, Utilities, Maintenance)
Value Add in expenses by charging monthly fee to tenants for Water and Gas current owner pays and is in above expense.
Washer/Dryer in units.
Top Floor 1 Bed 1 Bath - $650/month - $40 Late fee starting on the 5th of the month
Middle Floor 2 Bed 1 Bath - $725/month - $40 Late fee starting on the 5th of the month
Basement Unit - 1 Bed 1 Bath - $550/month - $40 Late fee starting on the 5th of the month
Rent = $23,100
5% Vacancy = (1200)
Expense = (8,328)
NOI = $13,572
Cap Rate = 11.08%
CoC = 20.56% after debt service of 75% LTV
Returns calculated with $15,000 in renovation expenses once tenants vacate. Each unit will need a nice make ready for new tenant carpet, paint, and may need new appliances.
Does anyone have any idea how I can fund this deal with limited funds?
Thank you so much!