First Deal... Help Please!

[Johana Monroy]

Hi,

I found what I think might be a good deal in my area. A duplex for $145,000, both sides could be rented for $850, generating a potential rental income of $20,400 per year. Property taxes is $1,500 per year. Down payment $20K. What do you think of this deal?

Thank you,

JM

[Canesha Edwards]

@Johana Monroy

Couple of things I would need to in order to help. You didn't mention anything about expenses. Some typical expenses would be ( maintenance, Capx, property Management, insurance, etc). Once you have your expenses, you can figure out your NOI.

Couple of things.

1. Make sure to do your own due diligence. Always verify the sellers numbers. Pro Forma numbers tend to be a lot different from actual numbers. Make sure to ask for rent rolls, vendor invoices etc as part of your due diligence.

2. I never determine if a deal is good or not based on spec numbers. You want to base your offer price on current numbers, not what the property could rent for.

3. Does the property come with tenants already in place?

4. What class property is this? A,B,C?