it seems like this could be a good deal if i play with the numbers a little more. the main thing that i cannot understand is the monthly expenses. doesn't seem to add up annually even with the insurance and taxes. so it is really throwing me off. this is the first time i have posted a report to the forum.
*This link comes directly from our calculators, based on information input by the member who posted.
Still in the research phase myself, but I had a few questions;
1) Would you go FHA with this and live in one of the units? If not, your downpayment would have to be around the 20% mark if i'm not mistaken, and your a few thousand off with your numbers.
2) How did you come up with $3500 closing costs for a $500k home? This seems a little on the lower side to me (I could be mistaken)
3) a 6.9 cap and $300+ cash flow for a half million dollar property seems very low to me. If that's your market, I would suggest looking elsewhere in the country.
That's just my very inexperienced take, not meaning to offend!
@Brian Kosack You are missing Property Management. Including that @ 10% and your cash flow disappears.
Depending on the age, CapEx and repairs seem low.
Howdy @Brian Kosack
Are you planning to House Hack this deal? 5% Down payment is not going to work with a commercial property (5 plus units). That is unless you found a portfolio lender that will do it. Otherwise you will need to put 25% down. And you will not be able to use Residential Financing (30 years amortization/sub 5% Interest Rate). It will be more like 15 to 20 years amortization, 3 to 5 year loan term, and over 5% Interest (possibly a variable rate).
I also agree your expenses are too low and missing some. PM, Insurance, and any common utilities the owner may be responsible for. What is the $650 Misc covering? Seems excessive for that category.
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