Thoughts on this Deal?

4 Replies

I have come across a 5 unit apartment complex in a college town  off the market currently. 

Owner is trying to sell since he is older and looking to retire. 

100% occupied with leases through December of 2018

-Purchase price: $105,000

-Monthly rent: $2250

-Annual Tax: $1154($96.00monthly)

-Annual Insurance: $ 1275( $106 monthly) 

-Property Management : 8% $180.00 monthly

-Rents are currently about 10% below market value. 

-Each unit Separately metered so no utilities

-Renovated in 2016. 

-Cap Ex budget -$ 200 a monthly 

What am I missing and am I the only one thinking this deal is a steal? 

based on those numbers it would pass my initial test. I would make a decision quick if I were you, if he puts it on the market at that price I would imagine you would have some competition. I would cover myself by making the offer contingent on property inspection.

@Jacob A.
I would make an offer contingent upon an inspection and see how much work the place needs and also confirm it is zoned to be 5 units

@Jacob A. . Initial numbers look like a very good deal indeed. I would act on it fast and definitely before it hits the market. Of course property inspection shouldn't reveal any major issues.

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