Help with first deal: House hacking townhome

[Aditya Maini]

Hi everyone,

I saw my first 4 properties yesterday and I liked the following townhome the best. I don’t want to jump the gun on a property. Is this property worth it? It’s in the northern Virginia area. It’s a 3 bed/2 bath townhome. There are three bedrooms upstairs with one bath, and there’s a basement which I plan to rent out as a bedroom. There’s a full bath in the basement and counter space for a makeshift kitchen. Here’s the breakdown:

purchase price: $400k

Downpayment: 3%, conventional loan

Closing costs: $8k

Income: $2650. I’m going to rent 3 bedrooms on the top floor, then put a bedroom in the basement and rent that out. Estimating $900 for basement and $550-700 for the 3 beds. 

Monthly costs: $2133 ($68 HOA, $332 property tax, $126 mortgage insurance, principal and interest: $1533)

Vacancy rate: 5%
maintenance cost: $100/mo

Total cash flow: $284/mo

[Joaquin Camarasa]

I have friends there that rent rooms for around $700 to $750. Vacancies are not too long, I think you should be fine.