A potential property

[Shruti Agarwal]

Hello all,

I'm  a newbie in real estate investing and need your advice.

I have a potential property (my first rental) that i can buy and need your guidance if it makes sense.

Townhome, 3B, 2.5B, 1400sqft living, 1,800 Sq. Ft. lot, 2001 built

Offer price $195K (includes closing costs etc) in portland OR

HoA $150 (includes exterior, yard)

20% down ($39K)

Potential rent $1500-$1600

In my opinion, i'm just breaking even but I understand I'll be building equity etc..

Do you guys think it's a wise investment? I need your advice quickly as I need to make the decision today.. Thank you so much in advance.

Sam

[Michell P.]

Originally posted by @Shruti Agarwal:

Thanks Michell for your advice. This does seem like a decent property in a great location/condition and the fact that I haven't come across many which are close to this..makes this decision even harder...

What are some of the drawbacks of HoA? 

And I'm hoping that since I'm breaking even now, in a year or 2 from now, it'll start cash flowing..is that a bad assumption? 

Moreover, someone is still paying my mortgage..

Feel free to PM me what the actual apartment is, and I'll let you know what I think of it as an investment if you need a second set of eyeballs on it.  But like the other posters said... HOAs can be rough - you never know what they're going to do in the future.  They can limit the number of rentals, raise their prices, limit who can sell and when, harass tenants over parking and so on.  

In Portland, you can assume it'll go up - but keep in mind we have a ton of construction going on right now.  I'm personally not comfortable banking on appreciation - but then again, I've lost out on a lot of good deals because of my conservative views.