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Updated almost 5 years ago,

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6
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Garret Coffman
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6
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Help Analyze Deal Pittsburgh PA Greenfield Area

Garret Coffman
Posted

Hello,

First time posting here looking to buy my first deal soon.

https://www.zillow.com/homedetails/525-Farnsworth-St-Pittsburgh-PA-15207/11544694_zpid/ <--- Not planning on buying just verifying I get this.

I'm using the four quadrant method to figure out the cash flow on the property.

So 20% down on this property would be 77,800 which would leave me with 311,000 in principal, good so far. Now each unit I could rent out for 1300 a month giving me an income of 3900. Now for the expenses part I was taught that you should estimate that expenses will take up 40 PERCENT of your income which is 1560. 

Now if this is all correct I can't figure out the debt. This is calculated by taking interest rate multiplied by reamining principal of 311,200 correct? If so, what does that number mean is it  mortgage on top of  expenses? I know once you figure debt and expenses you just subtract it from the income.

So, if interest rate of this property was 6 percent (theoretical I can't find it) than the remaining debt would be 1556 a month? Giving an monthly cash flow of 784 making this a moderate deal? Now with that how do I calculate ROI?

I know I could just use biggerpockets calculator but whenever you get into 8+ units it becomes inadequate entering all of the units. 

Last comment would you buy this deal if your in the Pittsburgh area based on location and crunching the numbers?

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