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Updated about 4 years ago,
Is this a smart first purchase on a duplex?
I saw a duplex in Columbus, Ohio for $275k the other day. Strong bones with more recent upgrades. AC/Furnace (2014), Appliances (2015+), Windows (2007), Electric Boxes (2019), Roof in good shape, etc. I calculated that the duplex will bring in around $2400/month with almost zero renovations if any (Maybe paint and landscaping). My question is, as a first time investment, would it be wise to put a low down payment such as 3-5% and collect small positive cash flow long term say 10+ years?
Broadly analyzing, the 50% rule leaves me with $1200/month for mortgage and cash flow. Putting 5% down with a conventional loan puts my mortgage at around $1,100/month depending on the approved interest rate of the loan. My cash flow would be ~$100/month which seems silly but the duplex doesn't need much work and the property would appreciate over time since I plan on holding it long term. ROI looks good as well. Am I missing anything?
I'm pretty greenhorn to real estate investing so I thought that making a move like this would give me good experience and a good first step in the right direction. Thank you for the replies in advance!