Hi BP members! A new member here! Been reading many threads and have been looking around in the market for some time.
The property in interest is a 3 family home fully occupied, will be seeing it in person soon but was told there are no major issues that needs to be fixed so I did not include repair costs. Am I underestimating the other expenses tho? And if i can get any other advice on my analysis and whether you would go for it or not will be greatly appreciated!
Congrats on getting started. I'm fairly new here as well so take my opinion with a grain of salt and hopefully some more experienced investors can chime in as well.
I think you did a great job on the analysis. It all looks pretty conservative. I assume it's a nice property in a pretty nice neighborhood judging by the rent. I am just curious if the $3500 in income/month is what the property is currently bringing in, or if you're counting on raising rents? I wouldn't count on there being no repair costs period. I would budget at least 5% for repairs as well as the 5% you have budgeted for CapEx. The numbers still look pretty dang good either way.
So long as you have the capital available for the down payment, reserves, etc. and financing already secured -I'd say this looks like a home run. I'm a big proponent for more of a turn-key multi-family as a first property. Helps get your feet wet and reduces risk a bit.
Thanks for your input!! I really appreciate it. And yes, the rent amount is the actual amount the property is bringing in. I did just went to the property yesterday and finally got to see it in person. It's located in an okay neighborhood, not the best from my standpoint, but is close to a main street and an university (12min walk). All units are occupied and seems like they are all pre-screened by the current owner and are never late on payment. The stove and heating system seems a bit old in two of the units, and no driveway so I am a bit concern if any of these tenants do move out in the future. The Seller (from what I heard from the seller's agent) is more interested in getting an investor vs first time home owner, so they won't have to evict any tenants out as they have been great tenants in good standing.