Rate My First Deal

[Nathan W.]

Hey everyone, thanks for the great resource here. I have learned a lot since becoming a member and am about to pull the trigger on my first property. I live in DC so the prices here do not warrant a buy and hold strategy so I expanded my search out to smaller cities in Virginia. I settled on a duplex in Roanoke. Listed at $88k (on the market for 250 or so days), offered $78, seller countered at full list price (umm ok), I threw them a bone at $81.5, and they countered at $82k. Ohhhh k, so I guess I can get it for $82.

The numbers are below

Income:

Unit A Rent: $495

Unit B Rent: $555

Unit B Pet Fee: $10 (wow)

Vacancy Estimate: 8.3% (one month/year)

NRI: $972/month $11,660/year

Expenses:
Management: 10%($97/month)

Leasing Fees: $75 (only for turnover, not renewals)

Repairs/Maintenance: 10% ($97/month)

Taxes: $54/month

HOI: $65/month

Utilities (water): $80/month

Lawn Care (every other week for half the year): $38

NOE: $444/month, $5,324/year

Mortgage (20% down @ 5.125%): $357

NOI: $528/month, $6335/year

Cash Flow: $171/month, $2049/year

Expense Ratio: 45.7%

Cap Rate: 7.7%

Rent/Value Ratio: 1.29%

Cash on Cash Return: 10.9%

Anything that you guys see I may be missing? Are my numbers pretty solid? Cash flow is not the greatest but the rents are under market right now and the tenants have been there for 2+ years so the vacancy rates are good and I should be able to raise rents when they move on (that $10 pet fee was ridiculously low).

Appreciate your thoughts.