Analyzing My First Deal

[Naeem Boucher]

Hello,

I wanted to run the numbers on my first deal to get the thoughts of any experienced out there.  My long term goal is to become an advanced real estate investor holding property cash flowing a month at least 10k a month by the time I'm 30.  I have 5 years to reach my goal so not much time and need to get the ball rolling.  My original first deal fell through because it was a short sale and the seller needed her ex-husband to sign off whom failed to do so.  I learned from that experience and figured I'd go with a regular sale until I'm ready to pursue another possible short sale.

Ok on to the numbers...

I currently have a two family house under contract and plan to use an FHA loan to acquire the property located in Paterson NJ. I offered 169,600 and will be receiving $9,600 back to use towards closing cost. I don't plan to use all of the funds so this number should reduce depending on funds I can accumulate while working and saving until closing.

The taxes on the property in 2016 was 6500, so I'm going to go with $7000 while estimating the mortgage. PMI $150, insurance would be around $80 a month. With a 3.75% rate principal and interest would be around $758. Im estimating the mortgage to be around $1560. The house has two units 3beds and 1 bath currently both are renting for $1300 each. If I live in one unit I could occupy one bedroom and rent the other two rooms for $300-$500 a room. When I decide to move which I plan to, I'll have a combine rental income of $2600 then I'll be able to cash flow about $1000 a month. Water/sewer is about $150-$300 in total every 3 months. I'll be able to save the cash flow including money from work then looking to get a 3-4 family enabling me to live in one unit while looking to cash flow at least $1,000k.

My plan is to have at least 10k a month in passive income my thoughts were if I can get 10 deals or less within 5 years with same numbers then in a perfect world it'll work out.  I understand I have to also account for vacancy/repairs.  I'll take any advice or thoughts related to my current deal and 5 year plan.  Im 25 years old and looking to get the ball rolling and creating long term wealth. Thank you in advanced.