First Deal Analysis - Purchasing a Duplex

[Kristopher Sharpe]

Hello all,

I am looking at making my first REI and finally found a property I am extremely interested in but wanted to make sure I am not missing anything. I found an off market deal for a 3 bed 2 bath duplex each unit having a 2 car garage and a decent sized yard. Each duplex is individually metered gas and electric, the water/sewer/gas is shared and the previous landlord has been paying that separately. I would be moving into one of the units for probably 2-3 years while saving for a down payment for another deal, for my calculations I am assuming both units are rented out. Am I missing any costs or not budgeting enough towards any of the costs. Additionally, if I were to allow pets (which I will) I could likely add another 50-100$/month, I did these calculations as conservative as I could.

Any advice would be greatly appreciated!

Purchase Price	$375,000.00
Down Payment	20.00%
Interest Rate	2.88%
Loan Term (Months)	360
Vacancy Rate	2.70%
Property Manager Rate	0.00%
1. Income	3. Cash Flow
Rental Income	$2,600.00	Total Monthly Income	$2,600.00
Laundry Income	$0.00	Total Monthly Expenses	$2,009.88
Storage Income	$0.00	Total Monthly Cash Flow	$590.12
Misc Income	$0.00
Total Income	$2,600.00	Total Annual Cash Flow	$7,081.47
2. Expenses	4. Cash on Cash Return
Mortgage	$1,244.68	Down Payment	$75,000.00
Property Taxes	$150.00	Closing Costs	$0.00
Home Insurance	$125.00	Refurb Budget	$0.00
Property Management (12%)	$0.00	Misc Other	$0.00
Vacancy (5%)	$70.20
Water/Sewer	$100.00
Garbage	$20.00
Electric	$0.00
Gas	$0.00
HOA Fees	$0.00
Lawn/Snow	$0.00
Mortgage Insurance	$0.00
Repairs	$150.00	Total Investment	$75,000.00
Capital Expenditures	$150.00	Annual Cash Flow/Total Investment	0.0944196
Total Monthly Expenses	$2,009.88	Cash on Cash Return	9.442