Should I buy it?

[Gunnar Teltow]

My neighbor who lives in Japan wants to sell his house to me, which is right next to mine in Circle C in Austin. We got an appraisal for $350,000, which I know is realistic. After splitting the broker commission savings I could get it for perhaps $335,000.

It's currently rented for $2,400/mo and the rental market is strong, and so is the appreciation potential in Austin. We can finance 75% (~$250,000) at a good rate.

My concern here is that we would have to come up with $80,000 or so in cash or from another lender. My wife and I would like to buy a handful of properties over time as cash flow investments for when we retire. Should we focus more on lower priced duplexes and such, or buy this one with higher appreciation potential but knowing that we would likely have to come out of pocket for taxes and repairs?

The rent will cover debt service if the property was 100% financed but nothing more. Family income is good so we can afford to support a negative cash flow property but I don't know if it's ever a good idea to buy a house just for appreciation.

Sorry first time poster and brand new member so no picture/track record on BP yet but I would really, really appreciate any and all thoughts on this situation. Thank you!!