Afraid to pull the trigger, is this a good deal?

[Todd Ryan]

I live in the Rochester NY  area. I've been looking to buy my first multi-family house all summer long.My search has been mainly on the mls and craigslist.I've been having a hard time finding something that will meet my needs and also cash flow. My plan is to use the house as an owner occupied and eventually move out and rent the whole thing,and repeat .I've seen this strategy referd to as house hacking on the site.l found a duplex in a decent area with enough storage for my equipment but lm not sure about the numbers .Here it is, I would appreciate any feedback. Is this a good deal? .list price 110k, annual taxes $4900, current rents $1300 combined, utilities split except water, water about  $50 monthly, garbage $60 a month ,insurance not sure estimate  $100 a month .furnaces water heaters and roof 18yrs old, house built in the late 1940s .mortage info 5% down 3.5%interest for 30yrs .

[Kevin Hunter]

Todd Ryan , that deal is very thin. First thing that caught my attention: Why are you planning 10% for management? Do it yourself and cut that out, especially if you are going to live there. However, even when you pull out the 10%, you are still in the red. Second, the current rents being $1300 isnt good when you are going to live in it. My assumption is you will live in the least desirable unit, but you will still lose that portion of the rent. Take that into account when thinking it through.

Suggestions:
Can you improve the apartments and raise the rent? If so, do it and get the rents up.

Use the old roof, etc to your advantage and negotiate. Re-work the mortgage calculator to a number you are more comfortable with and make an offer lower than the 110K.

I will not advise either way because this is your deal and you need to be comfortable. If you are comfortable taking a monthly loss but gaining experience and knowledge, that is your choice. That experience can come at a cost (even one that is worth it), but it doesn't have to.

Good luck!