Skip to content
×
PRO
Pro Members Get Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
$0
TODAY
$69.00/month when billed monthly.
$32.50/month when billed annually.
7 day free trial. Cancel anytime
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
Buying & Selling Real Estate
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 2 years ago,

User Stats

5
Posts
1
Votes
Erin Babnik
1
Votes |
5
Posts

Make use of a 1.6% mortgage or wait for better deals?

Erin Babnik
Posted

Our bank (in Europe) is offering a 1.6% fixed mortgage for at least the next couple of weeks, and we have some cash to invest. Using the Bigger Pockets calculator, I see that our best deal at the moment works out to a "5.94% 5-year annualized return" and a "CoC ROI" of 6.65% after 20 years. That's bad, right? (We are total beginners, with a single rental property that we have only because it was formerly our primary residence.) Can anyone tell me if I'm misunderstanding the analysis of the rental property calculator? Is this a poor investment?

Looking for properties here in Slovenia has been like shopping for toilet paper in the US in March of 2020: there is extremely scant inventory, and prices have shot up similarly to hot markets in the US. The properties for sale are basically a bunch of overpriced table scraps that won't cash flow. We've tried to be open-minded and creative, looking at everything from the nation's capitol to possible opportunity zones along areas where new highways are being built. We've looked at distressed properties and ones that are newer builds. We've kept an open mind about adding value through renovations/additions. There just isn't much to choose from that's viable, unfortunately.

After a very frustrating month of researching and visiting properties, our most interesting option is an off-market deal through family in a desirable location near the "Old Town" city center (an area filled with jobs and tourist attractions). It looks like it won't cash flow until the second year (if I'm working the calculators correctly). From the second year onwards, projections show cash flow becoming positive, but it's a slim margin for a while. After 15 years, we would have the mortgage paid off, so cash flow would be a lot better.

Are we looking at yet another table scrap that we should pass up? If we don't find something in the next couple of weeks, we'll have to miss out on the 1.6% fixed mortgage offer. Definitely feeling some FOMO here. Maybe we should just invest in mutual funds instead and revisit our options in a few years? Would really appreciate some advice. Thanks!

Loading replies...