Turnkey portfolio - feedback welcome!

[Johnathan Alesso]

We are about to purchase a 13-property portfolio of singles and duplexes under one packaged commercial loan with an interest rate of 5% over 15 years.  The rate becomes variable at year 5.  The one loan covers all of the properties, and I am told that I am able to sell off each property as I wish individually. 

The 13 properties are in C neighborhoods in Western Pennsylvania.  The total annual income is $94,000 and total net income $48,000.  The insurance is approximately $4,600 for the entire package; annual taxes are $7,600.  The insurance is ACV, but an enhanced version that covers more perils.

The units are all leased except for one.  Given the number of properties, I chose not to elect home inspections.  For this price level, it seemed reasonable to me as each would cost about $400.  I have an excellent property manager lined up to take care of all issues. 

The ultimate goal is to achieve financial freedom through cash flow income.  I look forward to all of your thoughts and feedback!

[Gino Barbaro]

@Johnathan Alesso

I would advise against not getting an inspection.  At the very least, try to have an inspector do a cursory walk through and try to negotiate on his fee.  Once you own it it's your problem.

If you find any issues, they may be retradable offenses, such as roofs, boilers.  This will pay for your inspection and may prevent any problems going forward.

Gino