Columbia, SC · Member since 2014 · 21 posts · 1 vote
Hey guys. I was thinking about buying a 6 unit multi-family house. 5 are 2bedroom/1bathroom and 1 are 3 bedroom. The owner pays for cable, lawn service, sewer service, trash, and water. The unit is $70,000. The tenants pay rent in this area between $550 to $650. I was thinking about putting 20% so my mortgage can range about $400 a month. Do you think this is a good idea? Help please
70k for a 6 unit? I am not familiar with your market but I would recommend comparing this to other multifamilies that sold in the same area to see if anything sticks out as not being right. Price seems low unless it is just a really depressed area.
Personally, I would never buy a property where I am set up to pay any utilities, especially cable!
You need to consider a lot of other variables like taxes, insurance, property management, repairs/maintenance/capex, etc.
Do a little more digging and analysis before you move forward.
$70k for the building... or $70k per unit equaling $420k for the building?
Anything over 4 units is considered a commercial property... you'll generally have to do a larger down payment and have higher interest rates over shorter amortization. You'll likely have a hard time finding someone on the commercial side fund down that low but if you're really generating $3,600 a month in rent on a $70k property (over 5%) you can likely find a private lender and would do fine even on a 10 year note.