So my friend and I closed on a duplex with live-in basement for $265k. We're using an FHA loan (we were able to lock in 4.6% interest), so we technically have to move in within 60 days, and then we can move out in a year. We were able to find it because my friend is friends with the seller (#1), who was using it as a medium term rental mostly to travel nurses (the property is a block or a 5 minute walk from the hospital). She (previous owner) rents out the 2/1 side for $1500, 1/1 for $1300 and basement $1100. My friend and I will basically be house hacking for a year, then moving out and renting the whole thing (my friend has her own house in Casper which she'll be renting out while we live in the duplex). PITI is $1743 and we can fix it up to increase rents a little so that we can bank on $1500/month not counting capex, maintenance, utilities, 10% vacancy and 10% reserve.

Question: How do you suggest I calculate capex and maintenance? Furnace is 2 (3?) years old, roof is at half life. We think we might just be able to break even the first year before we get rid of PMI (btw, seller #1 is basically giving us all the furnishings, furniture and appliances too, which are all 5 years or younger).

Then my friend gets a phone call from a neighbor who is asking us to buy his property so that he can move to another house he prefers (forgot if it was a bigger house or closer to work). It's a 3/2 house and he was originally wanting $230k, however my friend asked if he could do $200k and offer seller (#2) financing. He said yes to both, but he could only finance $100k (he says at 5% but we can probalby sweet talk him into less) so we'll be raising $100k (I already got some friends and family supporting my half, and my friend has her own line of credit). From past experience, both my friend and seller #1 have less than 10% vacancy on their short/medium term rentals (because they're so close to the hopsital). Gross rents for bedrooms for 3 month leases is approximately $1100 per door so in this case $3300 before PITI, capex, maintenence, etc.

Just wanted to share, because I'm pretty happy with my initial foray into real estate investing. Any comments and suggestions for buy and hold welcome! I'm completely fumbling in the dark and not quite sure what I'm doing. I barely have any cash to my own name, so I always thought finding money was simply monumentally hard to find, followed by how to find motivated sellers outside the MLS. Turns out, if you network well and talk to people, you can find both even when working a full time job.

Casper, Wyoming

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