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Updated almost 3 years ago on . Most recent reply

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5
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Tony Z.
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5
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Need advice with first investment opportunity

Tony Z.
Posted

Hey everyone. 
   this is my first time posting and I’ve been doing a lot of homework lately. 
i been looking in Pennsylvania for my first investment property.
i came across a property today. 2 family ( duplex ) in a desired part of Pennsylvania. 

rent roll is 2200. Everything is turn key. Was a fix and flip , electric heat. New LVP flooring. New windows. New roof , New stainless steel appliances , bathrooms everything separated ( water, gas , electric , water ) with tenants paying all utilities. and the ask is 220k ( meeting the 1% rule ) I would ask to close at 210k, if I were to land at that price 

with Taxes , Insurance, Principal, at 4.6% interest rate, I'm Looking at 1200 monthly payment. When calculating my numbers I like to put 18% aside from rent roll for minor , major and vacancies which would be another 400 which brings me to 1600. Based off my numbers with down payment and closing my ROI is 14%.

im getting kind of nervous, cold feet. Idk if this is good , not good enough. I know the market is hot now but what if the rent market cools down. I’m getting slightly turned off 

please , any advice would be greatly appreciated 

Thanks 

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5
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Tony Z.
1
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5
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Tony Z.
Replied

Based on going rate for rental units in the area that’s what I’m basing the new apartments renting for. I understand that the seller makes money selling the highs but I was in the area myself area is beautiful. Everything is well kept. Manicured with new train station (am track) being built in town , rental comps are similar for older not so updated units. The nervousness is coming more from this being my first possible deal and just self doubt on the overall market but this would be a long term hold. So I’m just getting a little nervous not based off numbers because everything I calculate is conservative. 

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