Would this be a good deal for buy and hold in the NYC metro area?

[Jon Huber]

This is in the NYC metro area, and is a short walk to the train line to New York City. NYC commute would be about 30 minutes.

This is a short sale and the purchase price is considerably lower then the homes that have sold in the neighborhood. This would be a buy-and-hold property. It is a very nice and safe neighborhood (B or B- if I were grading), and is a 3 BR, 2BA. The house is two stories and about 2,000 sq ft. There are a few cosmetic things to fix (little spackle, little paint), but the foundation and roof are sound.

Rent: 1,800

Purchase price: 175,000

Mortgage (PIMI): 860

Property Taxes: 7,000

The numbers will be tight. The numbers I run seem to have little cash flow, however, still positive. Now I am putting it out there to see what you guys think...

[Victor Menasce]

Why is it important that the property be in the NYC area? If the numbers don't work, they don't work. The reality will probably be worse. I reserve an additional 8%~15% for maintenance depending on the property. When you take that into account, you're definitely in the red.

By contrast, I invest in projects in Philadelphia that are close to the universities. I am building new construction. All-in my costs are about $102,000 per door. Rents are $1,250 per month. With a 10 year tax abatement, my cash flows are about $1200 per month for a 4 unit building. I'm able to refinance the project within a year at 70% loan to value and recover 100% of my invested cash. Would I stop doing these projects and buy your NY property? No.

Focus on creating the right team in the right location where you can create a stream of investment. Deals can be easily created from there.

I'm not preaching, just sharing what I do.

Hope that helps.

V.