Rental Property Investor · Greenwich, CT · Member since 2015 · 4k+ posts · 2k+ votes
7y
@Melissa ODell, what kind of property is this? SFR or MFR? How many units, what's the breakdown and rent for each?
A few thoughts about your expenses:
What electricity are you paying? $300/month is a lot and may be the difference between deal and no-deal on this property.
CapEx is too low. I usually figure 7.5% of GSR.
You're missing Repairs, which will also be ~7.5%.
Water/sewer look good if this is a duplex. $30-40/month/unit usually, but can vary depending on your location.
Insurance is very high. I'd expect 1/2 that or lower. Talk to an insurance agent to get a more accurate estimate.
You should include management (10%), even if you plan to self-manage in the beginning.
Is your plan to owner-occupy? If not, you'll need to adjust your loan assumptions.
Confirm closing costs with your lender. Average in the U.S. is $4k+.
You should include some money for initial repairs. There's always something!
Re-run your numbers and see how it looks. This slightly beats the 1% rule and if owner-occupying, might be a good move. That being said. I like to see $150-200/month/unit cash flow. The cash-on-cash return here isn't so great as it is.