New Investor Looking for Advice on investing in a low income area

[Ryan Pang]

Hi All,

I'm an accidental investor, turning my primary to a rental. After 4 years, I'm able to extract some equity out of it (my downpayment), and looking to invest in a LOWLOW income area.

Found a duplex, sight unseen, but the numbers look good (so far). Duplex is listed for $125ish, current tenants is paying $850 and $900, not section 8, with additional storage rent (2/3 rented out at $80/each).

Q1-I feel like my math is missing something. Here are my numbers,

CAPEX	10%
Repairs	5%
Vacancy	5%
LTV Loan	75%
LTV Equity	25%
Based on VAR (value after repairs)	125000
Loan 75%	93750
Equity 25%	31250
Monthly Fixed Expenses
PITI (Principal & Interest, property, tax, home insurance)	1050
Property managment (10%)	170
Sub Total	1220
Eventual Expenses
Repairs	170
Vacany	85
Capex	85
Sub Total	340
Total Expenses	1560
NET (+$160 Storage rental)	300

Q2- If I'm able to pay for it in cash, can I finance out it to extract equity in such neighborhoods?