[Calc Review] Help me analyze this deal

2 Replies

@Ramiro Rodriguez is this 100% financed?

Also your allocated monthly expenses are quite low.  Cap ex and maintenance each month combined are $50.  That's a tight estimate unless most every cap ex item is in great condition.  

@Ramiro Rodriguez whenever the maintenance and Capex budget is expected to be that low, I allocate a reserve fund for the property. At $25 per month if you did have a Capex item occur it would massively distort your calculations.

For example, if the AC went out 1 year in. You allotted for only $300 annually for Capex. An AC replaced on the cheap at $4000, that's 160 months of your allocated Capex budget, just slightly over 13 years.

The point being, the budget allotment is so low it cannot account for many mistakes and takes a disproportionate amount of time to recover. But if you set $2500 or more (I put $5000) aside as a reserve Capex fund you can run numbers tighter as you have already 'paid' for the Capex upfront with your reserve amount.