[Calc Review] Help me analyze this rental property deal
Would someone mind taking a quick look at this? This is our first deal, so would love to have another set of eyes. This is four condos that have tenants. I realize Cash on cash is a bit low. We have been trying to shoot for 7%. However, we cannot find anything in our area near this. The list price is $320,000- so we aren't sure if we will get this price or not. Also, do we need to have "vacancy" included if it has tenants or should this be there for future issues? Thoughts?
Most Popular Reply
Closing costs and loan fees seem low, unless you're really paying cash. If you are, I kinda think you can find something better to do with 300K than get 6%.
Yes, you need to account for vacancy - your tenants will leave eventually, and you have to budget for those turnover costs. Your expense projections might be a bit on the low side overall, but obviously it all depends on your area, the property, etc.
6% strikes me as low, but if you're happy with that rate of return and the property is truly turnkey, then buying something is better than buying nothing.