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Hi BP Community!

I am currently planning my first house hack in the Detroit area. May I ask all of your opinions on this deal?

The listing price is $90k. I was thinking of using FHA loan, so, I only need to put 3.5% down. But, I read through a couple of blog posts that if I want to use FHA loan, there is an insurance premium that I need to pay upfront (I assume 1.5% from the total Loan Value). I also assume my PMI to be $100 and my insurance to be $120. I also assume total rehab to be $3000, thinking that I might need to buy dishwasher, refrigerator, washing and dryer machine for both units (one for myself and one for the rental unit).

The rental rate for the other unit is assumed to be $1000/month. However, based on the analysis, I produce negative cashflow for this property. In order for it to be positive cashflow, the price should go down to around $78k assuming the rental rate is still the same.

I know that if I put 20% down and rent both units, this property will actually give me a pretty good cash flow.

Is it normal to have a negative cash flow (at least for the 1st year) with FHA loan? Or should I modify my assumption or calculation?

What are all your thoughts about this? Thank you again for all the help BP!

Cheers,