Assess my deal

[Jacob Pereira]

Hi BP,

Just like most people who post on here, I think I'm always right. Recently, I've been thinking about it and I've decided I'd like to benchmark my investments against the thoughts of others and see how I fare. I'm going to try to minimize assumptions to make sure that I don't skew opinions, but I'll try to give as many factual detail as I can. I will of course give my arguments for the deal, when they're not necessarily factual yet. Tell me; am I an idiot, or is this deal doable.

Market: Austin, TX

Property: 4-plex in 78724 zipcode, built in 1983, some deferred maintenance, but nothing major

My offer price: $256,500

Total rent roll: $3,050 a month

Financing: 25% down, 3.85%

My thinking is that I can do a few basic repairs and raise the rents by about 10% in the next year, and then raise at market rates after that. No plans to do serious rehab beyond paint and replacing carpet with engineered wood anywhere in the near future.

Keep in mind the local market; I'm not in San Jose, where this would be a screaming deal, and I'm not in Lansing, where this would be the worst deal in the world. I'd equate my market as similar to Denver or Charlotte, although I'll let you guys give your own opinions on that as well.

Any advice, analysis, critique, hatred, or attaboys are welcome.

[Matthew Schroeder]

Considering you are doing some deep analysis, you surely pulled sales comps for 4-plexes (or, if not available, other MFRs) in the area.  How does your subject property compare?