[Calc Review] Help me analyze this deal - Please and Thank you!

[Ilena Napoles]

View report

Rookie here! trying to find my first deal! SO ready to buy our first investment property but need more info. Learning how to read these reports and determine how good of a deal or bad. What are the best indicators to really pay attention and which ones are for guidance but can still be a good deal? 

Any info/advise is much appreciated.

Thanks!

*This link comes directly from our calculators, based on information input by the member who posted.

[Tim Herman]

@Ilena Napoles Hard to analyze without more info. Size of the property, affects capex numbers. How many units. Interest rates seem low for an investment loan. Be closer to 6.5  to 7%. Like @Mitch Miller said your insurance and taxes seem extremely low. Most taxing authorities are at 1% of purchase price or more. I don't know if your state changes taxes after a purchase. If you looked it up the present owner may have a homeowners exemption and his taxes will be lower. Your new tax bill could be $2000/12 or $166 per month. A vacancy factor is the same as a turnover every 20 months. 5/100=1/20. What happens if you have to evict and it takes you 3 months to get them out. Your next tenant will have to stay 60 months to get back to the 5% vacancy. 

You will need to run a capex and maintenance budgets to see if your numbers look good. Using a percentage may not be the right answer. Here is an example of a maintenance budget. Upon turnover what are you going to do. A complete paint ot touchup. Are you going to deep clean before the next tenant. How many service calls in your time line. Using the 20 month turnover. Cost to paint $1000. Cost to clean $300. Number of service calls 1.5@$150=$225. Total cost $1525/20 months=$76.25. This would be how a maintenance budget would be done. You might have groundskeeping upon turnover and that would have to be factored in. You would have do a similar process with a capex budget.