Rental Property Investor · Greenwich, CT · Member since 2015 · 4k+ posts · 2k+ votes
6y
Hey, @Dwayne Townsend Sr. This could end up being a good little property, assuming your rent, ARV and reno numbers bear out.
A few things to consider in your analysis:
I'd bump Vacancy up to 8%. That's pretty standard for MFR.
Increase your Repairs and CapEx. I typically use 15% combined. Depending on what you're actually doing in the $20k renovation you may be able to reduce those expenses for a period of time. So, perhaps you start at 10% and slowly increase it each year. If you plan to hold this long term, it will all equal out.
Insurance looks high. I'd expect $50 or less/month. Talk with a local insurance agent.
If you're doubling the value of the property, you should expect the taxes to go up at some point, too.
What about water/sewer, lawn care, snow removal (if applicable), and admin/professional fees? Those are all usually paid by the owner with a MFR.
Do you have a lender that willing to lend on this? I ask because many don't like to go below a mortgage amount of $100k.