ANALYZING HELP NEEDED - share opinions

[Alex Wuesthoff]

Hello, 

I am looking at a property in the STL (Saint Louis) area for a possible rental. FYI this is my first deal ever. My plan currently is this - 

Purchase house with a 5% down 30 year conventional loan. The property costs 200k and seller is firm. Closing costs would be $6k. Now the house is listed as a 3 bed room, however there is a 4th bedroom and I am unsure why its not counted, as it has a closet and a larger window. I could move into the house and take another smaller loan out for the renovations, which (conservatively thinking) should be no more than 25-30k. 

Repairs would include the following - I would be adding another bathroom (most likely in the basement) which will include framing, electrical, pluming, etc. I will also be updating the bathroom upstairs. Kitchen needs cabinets painted, new backsplash, appliances, and countertops. There are hardwood floors that will need to be sanded and re-stained upstairs. In the basement the carpet needs to be replaced, drop-ceiling removed, and walls repainted. 

Once the renovations are done I would like to get the house reappraised which i believe would land around 265k (conservatively thinking again). I could take a HELOC loan out for 48k (70% of equity assuming its ARV is 265k) pay off the renovation loan and reinvest whats leftover. After renovations are done I would like to rent it out to someone. According to rentometer and homesnap the monthly rent should land roughly around $2k. Since this is my first property I would like to learn the skillset of managing a property but eventually would like to hire it out.

I am semi-confident in my numbers but looking for all and any feedbacks this is my first property and don’t want to miss something critical. Please let me know if you have any questions as I will be active in responding. 

Rental Calc Link - https://www.biggerpockets.com/...

Thank you all for your time!

-Alex