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Updated about 11 years ago,
First time buyer - live-in multi family deal analysis.
First time REI here. My business partner and I are looking to buy a duplex for $140,000. We would live in one side and rent out the other. Both sides have two bedrooms and one bath a piece. The duplex was built in the 70's and is in very good condition. We don't have a lot of money to put down, so our monthly payments will be $1300-1320 for mortgage, property tax, and all necessary insurance programs. This information is based on what the underwriter of the loan told us based on the list price of the property. We can likely pull in rent for around $875-950 a month from the other unit.
Our logic. We're paying $950 a month now to rent a similar place. We'll never see a return on that investment (not even a bad return!). The place listed for $230,000 in 2007. We're thinking that we can buy it now, live there for a while and sell it when the market gets better.
Thoughts?