Analyzing SFR with new roof & HVAC

[Kevin Richey]

Hello. Im analyzing an off market deal on a rental. The home appears to not be bringing current market rent. The current owner offered the house to me for what they purchased it for several years ago plus the cost of a roof and entire HVAC system replaced 2 months ago. Using these numbers, it would not quite meet the 50% rule and COC would be a little low. However, once rented for current market price the numbers meet my criteria although fall a little short of where I try to be but find it hard to do (with a quality SFR). However, the fact that it has a new roof and complete HVAC system means I likely wouldn't have a major expense for capex. How would this influence your decision?