College Town Rental

[Antonie E Fields]

Good afternoon BP family, I am thinking of purchasing a rental property in a college town but the value of the homes are not great but the rental income is pretty good. I need some advice on if I should continue with the purchase or run away from that area. Any advice would be greatly appreciated. Thank you in advance. 

[AJ Leman]

Ok, so here is a quick analysis:

Price: 71k
Down Payment: 14k

Mortgage: $450/month
Insurance: $50/month
Taxes: $50/month
Repairs: $50/month
CapEx: $100/month
Utlitlies: $100/month
Management: ?
TOTAL Exp: $800+
Rents: $1050/month

Cashflow: $250 or so.

Other factors: neighborhood, appreciation, tenant base, etc.

Seems like it could be a good deal. CapEx could be more depending on the age of home. For Example, a new roof would cost you several thousand at least!