Newbie from Dallas! Requesting feedback on potential deal
Hello to all! I would like to get some feedback on my analysis of a potential buy and hold purchase. Thanks for allowing me into your community and I look forward to the feedback. Here is the deal:
Purchase Price: $95K ($65K purchase plus $30K renovation loan worst case)
(1900 sft single family, 3 bedroom, 2 bath, 2 car garage in nice older established neighborhood)
(Recent Comps for non-foreclosure and non short sales range from $90K to $119K)
Cash Investment $24K (20% down payment plus closing costs)
Monthly Rent: $1,225
(Recent Comps for rentals range from $1225 -$1250.)
Monthly Vacancy Loss/Operating expenses: $575
- 5% vacancy loss ($61)
- 6.5% property manager ($75)
- 11.5% maintenance/reserve ($135)
- Landlord Insurance ($55)
- Property Taxes ($250)
Net Operating Income: $650
Debt Service $408 (based on 30 year, 5% interest rate)
Monthly Cash Flow: $242
Cash on Cash: 12.15%
Cap Rate: 8.20%
I am looking at this analysis more as a worst case. Looking for feedback (good and bad). I believe vacancy loss, interest rate and monthly rent numbers can be improved slightly to increase actual cash flow.