[Calc Review] Help me analyze this deal

[Justin Wotring]

Hey BP community,

An off-market opportunity to buy and hold two duplexes adjacent to one another came my way the other day and I'm heavily considering making an offer today (about 75% of value). They are very near a hospital and university and from what I gather from the deal finder, are fully rented totaling $2800/month. My only hesitations are obviously all that's going on right now with COVID-19, and I just saw that the number of unemployment claims eclipsed 3.3 million last week. I'm adding a 60-day conventional financing contingency to help ensure that we have plenty of time to do our due diligence and I have a safe cushion in reserves in case the tenants fall on hard times. I'm trying to zoom out and see the big picture of this deal instead of focusing on the immediate uncertainties. Would you do this deal now? See link to report below. Thanks!

View report

*This link comes directly from our calculators, based on information input by the member who posted.

[Trent Stone]

If your numbers check out I think it's a solid deal. I would raise your capex and repair budget probably closer to 10% each, the property looks a little older and stuff is bound to come up, especially if you aren't putting in any repairs up front. Also increase your vacancy rate to 10-12% and see if it's still a positive cashflow. Get the rent rolls and the P&L for the last 12-24 months. Look at the absolute worst month and see if it was still positive. and 11cap is pretty high unless you are in a war zone, I would double check all those numbers and all your expenses, but if they still pan out, I would pull the trigger. Good luck!!