Deal Analysis, rental property

[Andrea Johnson]

Hi BP community:

I have access to a deal that seems so-so to me, but I have purchased very little rental property so I'm putting it out to you.

The property is a condo, 960 SF, 2 beds, 2 baths, located in a smallish college town about 45 minutes from Portland, OR. The HOA is solid and the fees are $72/mo. The exterior has recently been redone: new hardi-plank siding, new windows and new roof. The interior needs no repairs and is just slightly out of date. Bottom line: I wouldn't redo the interior for a few years. Price is $80k and this is right at or slightly below market value. Rent is $820/mo and has a longterm tenant. Expenses (taxes, HOA, insurance) are $267/mo

I came up with a Cap of 8% (the bottom of where I am comfortable).

If I had $80k in cash sitting around, I would jump on this deal, but as it stands we would have to either 1) buy in a self-directed IRA for a longterm investment or 2) cash out part of our IRA, take a tax hit now, but enjoy $600/mo extra income forever. So in those two scenarios, does this deal make sense? I've calculated using OPM and the numbers just don't seem to work.

Thank you in advance,

Andrea