First Out of State - Under Contract

[Derek Luttrell]

I visited my dad in my hometown of Fort Wayne, IN this weekend, while also having an appointment to check out a SFR on the market. I also visited an old friend whose wedding I'm going to in June, and it just so happened that she was 5 days away from listing her house that she had bought two years ago (once married, she's moving to Indy where her fiancee lives).

After doing the necessary homework, I got home and decided to send her an offer before she had the chance to actually list it. It's in the dead center of a top school district, and I would have definitely had competition. I will be self-managing from Chicago, with my Dad as my handyman/drive by lookout when needed. Obviously, I still ran the numbers as if I had a PM in place. 

I turned 26 a few weeks ago, and this is my 3rd property since July 2017. I'm really starting to get more and more comfortable, which is a fun feeling. Here are the numbers:

Listing price (what it would have been): $135,000

Offer: $130,000

Contract: $132,500, with her paying $489 for a home warranty

20% down at 5% interest 

Rent: $1400 (3/2 single family ranch with attached 2 car garage) 

Tenant pays all utilities (even down to trash pickup) 

Cash Flow: $250/month after CapEx, Maintenance, Mgmt, etc; $115/month if using 50% rule