Plan after the military investing in a 4 plex analysis

[Oswaldo Arriasola]

4 plex analysis

Property is located in Edinburg, Texas

- Income generated per month from my job will be $6100

I am looking into one property at the moment for when I get out of the military next year and become a state trooper in Texas. I want to start investing in real estate within rental properties.

One of the properties I’m interested is as follows:

- The property is located close to an elementary, a Walmart and a university

- The property current asking price is $340,000

- The property is 4,778 square feet • 1,194 per apartment built in 2006

- Currently the property is currently leased for 750$ each and is generating $3,000 per month

- The property has a potential to have the rents increased to $850 meaning $3400 in total based on the surrounding rents being charged around in the market

- Estimated monthly cost

$2,227

- Principal & interest

$1,508/mo

included with no down payment

- Mortgage insurance

Not included since not required by VA loan

-Property taxes

$550/mo

-Home insurance

$119/mo

-HOA fees

$100/mo

Garbage lawn care and other services

-Utilities

Tenants pay for utility bills

- $2,250 a month in total on average

I plan on living in one since VA loan required me to vacate one apartment...depending on the rate of the income and the amount being generated and with the steady flow of tenants I can continue to get another apartment in the near future

- At the moment it is generating $3,000

- Since I’m living in one, the amount generated will be, $2,250

3000-750= 2,250

- Enough to pay off the property expenses and live for free

- if I increase the rents based on the location to $850 I will be generating $3400 but again since I’ll be living one I will be making $2550

- so 2,550-2,250= 300

- $300/mo will be generated in cashflow every month CAP rate of 6.7%

- When I'm able to rent the 4 plex fully the total cash flow would be $1,150/mo with a total CAP rate of 9.6%

After a year or two of seeing steady tenants and rent increase I will do the same process but this time I will not be living in one generating the full amount having more cap rate within my second property and have my money generated within my job to be able to back up the payments in case of vacancy and repairs

- Goal

Invest in real estate and have my money generates throughout my income to maintain a property

Own 5 properties within 5 years

Buy 4 plex’s

20 rental apartments in total in 5 years

Is this too much or should I look for something smaller to start off with, and does this seem like an attainable and realistic goal according to my calculations.