Would you take this rental deal?

Question

See my analysis below:

https://www.biggerpockets.com/...

Aaron K. · Answer

@Cindy Mastin I most likely wouldn't.  I'm going to assume this is somewhere in MI that is likely to have limited to no appreciation over time.  Given the return you've calculated I could find better in what appear to be higher growth markets even in CA you could probably hit 5.65% cap rate if you shopped the MLS long enough.

Jared Maches · Answer

@Cindy Mastin Going through the numbers I don't think putting almost 30k for a return of just above $150 a month is worth it because anything could go wrong, this could put you in negative cashflow each month. Also, it seems that your CAPEX, Maintenance and Vacancy are really low and also your closing costs seem off too. Typically, Vacancy 8-10%, Maintenance 8-12%, Cap Ex 8-10% and lastly closing costs should be 4-5%. When assessing rental properties I tend to look for 10-12% CoC return just as a rule of thumb for my investing criteria. Overall, I think you should keep looking around your area for properties and get a good grip on analyzing the numbers.

Best of Luck

Aaron K. · Answer

Nope because the link you posted just takes me to the BP home page can't see anything @Cindy Mastin

Cindy Mastin · Answer

@Aaron K. and @Jared Maches

Thank you so much for taking the time to review and help me reconsider the numbers again.

Cindy Mastin · Answer

@Aaron K

Thank you! Let's try this again. I attached a couple screen shots.🤞

Would you take this rental deal?

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