First home buyer and introduction.

[Jacob Bunce]

First of all, I'm excited to finally be at this stage in my life. I have always planned on having a passive income for retirement via rental properties. I am 23 and looking to have children soon, (next 2 years) which means I need to get my finances in line. Before I go any further, I don't intend on asking for a mentor, just advise on this specific deal. (As per ToS)

I've been looking for houses for the last couple months, but recently I stumbled upon BP's youtube channel, which has been a wealth of information. It also opened my eyes to multi-home rental options. Now, there are several houses that I have fallen in love with and lost already, but like Brandon has advised me many times (via youtube/podcast) over the last couple weeks, I just need to start. 

In the Charleston area, there are not many multi-family properties for sale, unless I am missing something, but I did find one duplex in a decent area. This is were I am asking for advice, maybe some number checking. These are the figures that I came up with, but keeping in mind that I would be offer lower on the house. (90,000 would be good?)

The property's asking price is 110,000, and I would be using an FHA-like loan, so the down payment would be 3,850. There are 2 units, which both rent for roughly 650$ in the area. (I will be going with 600$ for my numbers to be conservative) Interest rate will be calculated at 5%, and loan term would be 30 years. After all of that is considered, the mortgage should be around 450$ per month. The 50% rule would end up giving me

1,300 - 600 = 700

700 / 2 = 350 (for duplex)

350 / 2 = 175$ per unit, per month. Not bad for a 50% rule. 

This leaves just the expenses. (120 for insurance, 233 for property taxes, 75$ for other) With all of these numbers, I figured that I would be getting a clash-flow of 328.48 per month for both units, leaving 164.24 after 50% rule is applied. 

I want to make sure I am doing this correctly, and as it stands, I want to put an offer down ASAP on this property. Keep in mind, that me and my wife do NOT own a house, so for the time being... we would not see both being rented, seeing as we would be living in one of them, but once we buy another house, this should be how the figures work out.