Rental Property Purchase scenario

[Mark Fein]

I have been given the opportunity to purchase a SFH in Florida. The owner is willing to finance the property at 5% on a 20 year note with zero down. They are selling the home for $550k. ARV is $625k (although the market shifting makes that somewhat of a concern). It needs $25k in cosmetic upgrades and in the next 12-24 months will need a roof replacement for 30k.

The projected rent of $3200 would cover the P&I payment. I would have to cover approx $900 a month in taxes, nsurance, HOA and other maintenence expenses. They are offering a 30 year at 6% zero down but Iooked at the numbers and I am not seroiusly considering that option.

I own two other rentals both free and clear (one has a HELOC with a zero balance) that net $3600 in passive income . The passive income from the other properties would more than cover the negative cash flow on this property. I have good income and do not need the passive income at this time. My goals are long term, building waelth and long term passive income. I am 44 years old and the 20 year mortgage fits my timeline for an estimated retirement age.

Thoughts?

[Steven Foster Wilson]

Quote from @Mark Fein:

I have been given the opportunity to purchase a SFH in Florida. The owner is willing to finance the property at 5% on a 20 year note with zero down. They are selling the home for $550k. ARV is $625k (although the market shifting makes that somewhat of a concern). It needs $25k in cosmetic upgrades and in the next 12-24 months will need a roof replacement for 30k.

The projected rent of $3200 would cover the P&I payment. I would have to cover approx $900 a month in taxes, nsurance, HOA and other maintenence expenses. They are offering a 30 year at 6% zero down but Iooked at the numbers and I am not seroiusly considering that option.

I own two other rentals both free and clear (one has a HELOC with a zero balance) that net $3600 in passive income . The passive income from the other properties would more than cover the negative cash flow on this property. I have good income and do not need the passive income at this time. My goals are long term, building waelth and long term passive income. I am 44 years old and the 20 year mortgage fits my timeline for an estimated retirement age.

Thoughts?

 Honestly, you could find 10x better deals here in Columbus that will cashflow and appreciate off the bat. I always say it is all about the numbers but in this case they do not line up at all. I like to use https://www.calculator.net/ren... this calculator. If you want to start building your wealth and long term passive income choose a market that can do that for you. Here are the Stats and trends for Columbus https://learn.roofstock.com/blog/columbus-oh-real-estate-market.