Second Deal

[Peter Mckernan]

Hello everyone,

I recently closed on a second deal with a business partner; it is the second deal that I have down with him and within real estate. The deal is a SFR in the greater Los Angeles area that closed two weeks ago today. We are currently listing it with many different websites as a rental. Both properties we have boughten were in the same area, both buy and hold investments, and have been purchased through the MLS.

The house was listed for $265,000 and we closed at $245,000 within 30 days. It is a 30 year fixed at 4.75%. I have ran the numbers and they are listed below. The best thing about the property is that it is in a nice blue collar neighborhood with great schools, great parks, a safe community, and a very strict code enforcement department to keep the town looking as clean as possible. The house is also a half mile away from a large university that could be helpful if we cannot rent it out to a family; we would be able to rent it out to college students that have good credit and a good rental history.

Cash needed at purchase: $60,929/2= $30,464.5

Monthly Cash Flow: $262.82

Cash on Cash ROI: 5.18%

NOI: $15423.04/245000= 6.3%

All the numbers above have vacancy, taxes, insurance, and maintenance included. Let me know any thoughts.

Thanks,

Peter