Duplex Analysis

[Account Closed]

Need some insight from the tried and true movers and shakers here. Carlton Sheets need not apply.

Side-by-side Duplex built in 2006. Market rent of $650/side. Purchase price of $50,000 and max rehab of $3,000. Bank will do the deal at 15% down and 10 year fixed 6.5%. This puts me out of pocket $7500 + $3000 rehab with a debt service of 482.58/month. Property Tax is $2300/year, insurance shoudl be around $2000 (thanks Katrina).

Using the 2% rule, max purchase price is $65,000 so I'm definitely in the clear there.

Using the 50% rule, monthly operating expense should average $650/month over the long term.

Numbers:

Revenue: $1300
Expense: ( 650)
Net: 650
Debt Service:( 482)
Cashflow 168/month

I'll have official comps from my realtor here shortly, but we're expecting the comps to come in at around $75k.

Cash-on-Cash: $2,016/10,500 = 19.2%

Would you do this deal?