SLC fourplex cash flowing deal

[Levi Brooke]

Alright, I am in a deal right now on a fourplex.

I will owner occupy for the first year because I am going to use the VA loan.

Details:

Purchase price $890000

4 plex has been fully rehabbed

Closing costs are ~8k

Interest rate is 2.375%

Cash flow while living in 1 unit for 1 year is ~$50 a month minus expenses

This is what I have worked up and hoping everyone else can give me their opinion.

Live in one unit of the 4 plex for one year, nearly mortgage free. The three rented units will pay for the one I am going to occupy.

After the first year, move out and the 4 units at their current renting rates will cash flow ~$1200 a month minus expenses.

I think expenses will be fairly low do to everything being new as of this year.

After the second year I will have an ROI of 180% minus expenses.

Am I doing this right? I have a good steady job as an engineer that pays very well and am not at risk of losing it. Roughly gross 100k.

My concern is the $890000 debt I will have created.

What’s everyone’s thoughts and questions? I just want to make sure I am making a right decision here.

Thanks a ton!

[Levi Brooke]

@Lee Ripma

Thanks Lee! The area seems really good. As far as statistics, this in SLC is ranked #1 for where young professionals are living and #6 for the best neighborhoods in SLC. I’m really excited about this and hope to close soon!