Buying & Selling Real Estate
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback
Updated almost 7 years ago, 01/18/2018
2nd Deal making me nervous
Hello my friends!
Im in the middle of signing a contract with a deal and its really making me nervous. Ive run the numbers and its a good cashflowing property. Well I should say its a great ROI property @ 26.7% to be exact! It makes me extremely nervous because its only at $66 a door. With it being a duplex it will only net $133 cashflow. Im trying to pull the trigger but im getting a weird gut feeling I cant exactly shake off.
The first year before I change the taxable amount for my county it nets the 26% ROI with only $6000 down of my own money bringing in a total of $133 cashflow. The second year I predict it to be 32% ROI, still only $6000 of my own personal money and $163 total cashflow. I can raise rents slightly higher giving the cashflow i want, but I dont want to rely on a prediction that can possibly fall through, I like to be slightly pessimistic in the beginning of deals. I ideally want $100 per door.
I see great ROI but not a lot of cashflow to justify it.
I want to hear all of your opinions, especially for this being my second rental property, is it a wise decision?