Contracted to buy. Bad idea?
I reached an accepted offer to purchase a 2 unit. I'm trying to decide if it's a horrible idea to go through with it given the current state of everything, or if its just fine. I'm supposed to in less than a month, I could back out in the next few days and eat $5,000 in earnest money.
Here are the numbers:
Mortgage+Taxes+Insurance = $2,680/mo
Other expenses: Other than vacancy, should be low in the short term. The place was gut rehabbed in 2017. To be conservative, I've assumed about $650/mo.
Rents: In a normal world I think rent should total $4,000/mo. Plus maybe $200/mo for garage usage.
One unit is currently rented at $2,100/mo but their lease is a few weeks after I close (I'm going to see if they'll stay, but I think they are planning on moving). The other unit is the owners unit, but its probably 150 sq/ft smaller, so I figure about $1,900/mo in a normal world.
That leaves cash flow at about $650-700/mo, not including the garage potential.
What I worry about is taking possession at a time when no one is really leaving their house to look at new apartments. If it blows over in by Mid-may or so, I'll be fine, if it sits vacant for 6 months, I'll be in trouble.
Curious what people think, thanks.