First deal: mobile home

[Tanner Fedell]

My grandpa in law and I have talked about doing a deal together since he knows I'm interested in real estate. He's 76 and has a sizable rental portfolio that he's built over the past 30 years.  He wants to show me the ropes and help me get started. 

The 1st deal we are looking at is a 1600 sq ft mobile home on 0.6 acre lot. He owns two similar mobiles on the same street and knows what it will rent for about $800-850/mo. 

Purchase price: $48000

Repairs: $6000

He talked about financing in a way I hadn't really heard or thought of. Basically we would get a loan from the bank 5 year roughly 6%. If we rented for $800/mo After taxes insurances and expenses we would each be out of pocket about $185/mo to pay it down in 5 years. I can afford that but didn't sound ideal to me since most of what I've read here is to buy cash flowing properties. I guess one of the pros is that we would have a pair for property in 5 years. 

I'm curious to know what you think and appreciate any advice you may have.