Advice on my first deal

[Chris Ravettine]

Hello All,

I am looking to submit an offer on a property that just came on the MLS a day or two ago. Its a 4 Family that is currently fully rented generating $5650 a month. I believe rent could be increased to $6000 a month eventually without much backlash to meet the current market rates. My original plan was to go FHA and move into one of the units, however my realtor (who is also the listing agent for the property) is suggesting that I go conventional as he believes the property will receive multiple offers by the end of the weekend. My offer would be at asking price. I can secure traditional financing at 25% down which puts me just north of $100k into the deal. This money would come from a family member that is out of state but willing to go into the deal with me. At the current monthly rent and my offer price cap rate would be around 12% with a COC ROI around 20-23% generating an annual cash flow of around $25k after expenses. Ideally I would have liked to find a property that was a candidate for a BRRRR but I believe this property is towards the top of the market for its area. Some of the units are bit more dated than others but none are in bad shape. A few kitchen/bathroom renovations down the line may be necessary but I am unsure if I would gain any worthwhile equity by doing so. Regardless of that, this seems like a good deal to me but I have a few questions.

1. What would be the best way to structure this deal so that my private money can get their cash back out of the deal in a reasonable amount of time.

2. Is it a bad idea to wrap up this much cash into one deal when I could potentially find some smaller properties for a BRRRR play? Or should I just take some time to let the cash flow build up enough for a downpayment on another property down the line?

3. Most of the big ticket items seem to be in good shape (of course an inspection will be done prior to closing) except for the 4 furnaces which are dated but in working order. I believe they are the original units from when most of the units were built in the 1980's. What would be a reasonable capex number to budget for this ? 

Would love to hear all of your suggestions on if you think this is a good deal, bad deal, or if you have any other advice on how to structure the deal to better benefit both me and my partner.