Please help! My first "real" deal and I'm at a crossraods

[Joel Kadlec]

I am currently under contract on two 4plexes that are side by side, so 8 total units. After the inspection I found out that all the AC units and furnaces will need to be replaced pretty soon due to their ancient age. Im estimating 8 ACs and 8 furnaces and install could run about 30k. There are also a lot of small things here and there.

The seller has agreed to fix a lot of things, but is doing himself so there will be no proper or licensed documentation which makes me nervous. Not sure if this is typical or not.

My plan is to hold for about 5 years and then sell and upgrade.

Anyway here are the numbers:

Purchase price: $170,000 (85k for each quad) ARV I estimate $240k

Loan is commercial 15% down 20yr

Monthly Income: $4,000

Monthly expenses: $3,087 (I estimate 5% vacany 8% repairs 8% capex, etc.)

Cashflow: $912

Cash needed: $59,000/this includes the 30k for HVAC as stated above. or I might be able to get a line of credit tacked onto the loan after apparsail comes through which would make my cash needed about $30,000 but would change my number a little as well obliviously.

ROI 18.4%

Good thing is that roof is only 2 years old and the exterior is in great condition.

Any advice would be greatly appreciated! My inspection revision deadline is on the 21st and I am trying to get as much input as possible from any source I know. Thank you all very much in advance!

Appreciatively,

Joel