Investor · Durham NC (and Brenham, TX) · Member since 2018 · 301 posts · 197 votes
6y
If all of your estimates are correct, looks like decent returns for holding a property in cash. And, it seems like you could refinance out at only 60% LTV, get all of your initial investment back (and then some), and still cash flow for infinite ROI! Seems potentially too good to be true but worth looking into further. I don't know exactly where this is, but seems like a pretty small town - are you sure you can hit your projections for rent / vacancy?
Cashiers, NC · Member since 2018 · 16 posts · 5 votes
6y
Annchen, thanks for taking the time to review and give your two cents. I tried to be conservative with everything so the numbers would be relatively safe and realistic. We have two other rental properties in that area and believe the rent projections are spot on. This house is a foreclosure and if we can snatch it up at a good price we plan to flip it (our first). Thanks again!
Rental Property Investor · Greenwich, CT · Member since 2015 · 4k+ posts · 2k+ votes
6y
You can probably pull back the repairs and CapEx to 15% combined, @James Bennett. I doubt insurance will be $150/month. Probably 1/2 that. You've left out management. Always include management in your underwriting, even if you plan to self-manage at first. I agree with @Annchen Knodt, but 60% LTV debt on it and get a nice little cash out. You'll still CF ~$150/month and be ready for the next one.