Chicago- Western suburbs -Two deals-cash flow $1400 p/m

[Kumar Paj]

Just completed two transactions (almost simultaneously) in Chicago Western suburbs and getting ready for the next one......

Transaction 1: Duplex (one unit) 3BR, 1.5 BTH (1150 Sq.ft)

- Purchase price: $89K

- Rehab: $15K

- HOA: 0

- Property Tax: $1800 p/a

- Insurance: $700 p/a

- Rent: $1450/ p/m

- Mortgage: $366 p/m

- Net Positive Cash Flow: $700 (taking into account vacancy rate and maintenance)

- Cash on Cash: 24.9%

- Cap Rate: 14.6%

Transaction 2: Duplex (one unit) 3BR, 1.5 BTH (1150 Sq.ft) 

- Purchase price: $95K

- Rehab: $5K

- HOA: 0

- Property Tax: $1800 p/a

- Insurance: $700 p/a

- Rent: $1400/ p/m

- Mortgage: $390 p/m

- Net Positive Cash Flow: $650 (taking into account vacancy rate and maintenance)

- Cash on Cash: 29%

- Cap Rate: 14%

Though I've done lots of foreclosures, the first transaction above was really challenging. Of course it was a foreclosed property but was vacant for more than four years i.e. gas line was disconnected from outside, plumbing issues, water damage and so on (many surprises). It took much more than I was expecting but the huge benefit was- I found the 2nd one right across the street at super cheap. It was a FSBO and I got there on the very first day...found a motivated seller and struck the deal withing 24 hours....not bad to have two units on the same street...easy to manage.

Would appreciate thoughts and feedback from experienced investors.....

[Gilbert Dominguez]

They both sound like good deals. I would not over think it now that you are into the properties because they both seem to be cash flowing good just keep the ball rolling.