Beginner Owner-Occupancy Duplex Opportunity

[Colin Simpson]

BP,

I am currently looking to purchase a duplex (3bd/2.5ba) that I plan to live in and rent for the rest of my time here in college. With no real experience in REI (but wanting to begin as soon as possible) I thought I may run this deal on the forums and see I can get some feedback from more seasoned investors. I have ran some of the formulas such as the 1% rule and the 50% rule but I just don't know how well of an indication that is on cash flow in this situation. Some details on the property are as follows:

Listed Price: $179900

Purchase Price: $175900 (may start offer at 170900)

Down Payment: 3.5%

Loan: 30 yr fixed @ 3.75%

Monthly Payment including taxes and insurance is estimated at $1,212

It will need a new washer and dryer on one side

I have another 5 people who would rent from me and I have told them $900/unit (units around it rent for around $750/side however $300 a person would be cheaper than they are paying now). This would bring in $1500/month (excluding my rent).

Currently each side is renting for $775 and $750. I believe I would need to reduce rates to around these numbers when these tenants moved out to keep it rented.

My plan is to live in one side while I finish my last two years of school, then either continue to rent it out or cash out (hoping it has appreciated).

I would love to have some opinions on this from other investors.

Much appreciated,

James Simpson