Is My Math Accurate? Houston Deal Anaylsis

[Lauren Brown]

Hello BP Community

I found a deal and contacted the wholesaler who had the property under contract. He provided me with the property breakdown and utility costs. The lead consists of two properties being sold as a package.  Property A is a duplex with a single family home and property B lot consists of a triplex with a garage that has two efficiency units. What I'm questioning is if the numbers check out and the property is in a Class D neighborhood according to the city would this still make a good deal. Also I'm not sure if I may have left something out of my calculations or if I should take anything else into account. My end goal is to have properties that generate minimum $200 cash flow a month.

Please let me know your thoughts, I'm not sure if I'm missing something in my calculations. Also I calculated the numbers below based on a loan term for a package deal. Is it possible to get a loan term with a lender that covers multiple properties sold together as a package? 

Cost Assumptions
Purchase Price	$285,000.00
Closing Costs at 4%	$11,400.00
Total Cost	$296,400.00
Mortgage at 30yr/5% Interest /20% down	$1,223.95

Monthly Expenses
Monthly Rent	$4,500.00
Electric	$250.00
Water	$200.00
Trash	$100.00
Vacany Rate 8%	$360.00
Maintenance 8%	$360.00
Property Manager 10%	$450.00
Insurance	$300.00
Monthly Property Taxes Due	$121.97
Cap Ex Reserve 7%	$315.00
Total Monthly Expenses	$2,456.97
Less Mortgage Payment	$1,223.95
Theoretical Cash Flow	$819.08

Cap Rate	Cash On Cash
8.6	14.37

[Lauren Brown]

@Mario Tavares Great points thank you for your advice. I didn't not move forward on this deal as there were too many unknowns and a higher risk deal. I would like to learn more around the PM viewpoints you have and your knowledge on the Houston market. Please send me a private message when you have a moment.