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Updated almost 8 years ago, 01/01/2017

User Stats

28
Posts
10
Votes
Alex Boyce
  • Winter Garden, FL
10
Votes |
28
Posts

Thoughts on First Property

Alex Boyce
  • Winter Garden, FL
Posted

Hey BP,

I'm currently renting and looking to buy/house-hack my first property. This particular house has a garage apartment, so the plan is to move into the garage apt and rent out the house. I can also Airbnb the apt on the weekends and crash at a friend's place. 

Purchase Price: $260K 

Downpayment: 3.5% via FHA loan = $9,100

Closing Costs: $7,800 (Asking seller to pay)

Rehab: $0 (House is in excellent condition, with limited/no rehab/upgrade potential)

Total Cash out of pocket: $9,100

Annual Rents: $36,000 (2,200/mo from house [utilities included], 800/mo [8 nights/mo] from Airbnb = 3K/mo)

PITI: $19,417 (30 year fixed @ 5% - estimate, need to find a lender)

HOA: $2,328 (includes cable)

Utilities: $5,160 (Electric, Gas, Water, Trash, etc)

Other: $6,120 (6% Repairs, 6% CapEx, 5% Vacancy Rate)

Cash flow: $4,775 ($398/mo)

Cashflow Margin: 13.3%

2% rule: 1.15%

50% rule: 41.8%

Cash-on-Cash: 52.5%

Cap Rate: 8.1%

Gross Rent Multiplier: 7.22

Debt Coverage Ratio: 1.3

Thoughts? The model varies a lot based on how much I can rent out the garage apt (breakeven at ~4 nights/mo)

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