Newbie Requesting Help Analyzing first SFR purchase

[Chris Cerny]

Hi all!   Would love to hear (read) your thoughts on this potential deal:

SFR - excellent neighborhood, excellent schools, 2/2, 1032 sf, built 1998

Currently rented for $825/mo,  (lease ends 10/2015), no "make-ready" costs

taxes = 1798 / year

Prop management = 792 / year

financing = 17,000 down  68,000 30 yrs @ 4.5%

comps in neighborhood sold recently 83k - 119k

What do y'all think?

[Rob Gleason]

Hi Chris and welcome to BP!  I'll start by saying my experience is very in real estate investing is very limited.  That said, this doesn't look like a good deal to me mainly because it doesn't pass my 1% sniff test (monthly rent > 1% of home value).  Couple that with the extra expenses mentioned by others and you'll have negative cash flow.  BTW, I don't include property appreciation in any of my calculations because 1) it varies 2) it will likely be offset by capital expenditures, which also vary.