[Calc Review] Help me analyze this deal

3 Replies

View report

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.

Hey Brian,

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.

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here