Yes or no, should I buy this condo?

[Kristina Grande]

Thanks for reading! 

The opportunity is a 1 bed/1 bath condo currently listed for $43,000 and located about 75mins from where I live. I own a 4 unit multi (15 mins away) and another condo (50 mins away) already. The prospective condo was foreclosed on so bank owned (bank bought the property back at $52,020). There is a tenant in place who is paying $875 per month and wants to stay (HUD FMR is $898). Taxes and HOA come out to $450 per month. Property is assessed by the city at $56,300 (maybe the sale will trigger the property to be reassessed at closer to the sale price- common in my area).

I'm curious what everyone's thoughts and opinions are. I'd be paying cash and its been on the market for 15 days. 

[Tchaka Owen]

@Kristina Grande - this is a tough one. Taxes and Condo Fees (not HOA) eat up more than half the rent. Once you factor in vacancy and maintenance/CapEx, you're knocking it down another $150. Assuming you're managing it, that's $275 left. You're paying cash so some see it as $275/mo. positive, however there's an opportunity cost to that money. I like to calculate that cash at 5% (amortized over 30 years). Once you do that, there isn't much left over. $875 is already near FMR so not much room there, and condo fees almost never decrease. I don't like the deal. If you can pick it up for $30k, it might work.