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Updated almost 8 years ago,
First deal too good to be true...?
Hi guys,
I've been stressing out about this current deal so figured why not go to boards and ask the real professionals. This will be new first investment property so I want to make sure I'm not missing anything here.
Basics : duplex - 2bdrm/1bath
Purchase price : 130,000
Assumed value of house : 137,000
Current rent: 750/unit.
Utilities separately metered.
Taxes: $1,200
Insurance : $1,100/yr
Maintenance : $1,600/yr
Cap ex: $1,600/yr
I'm coming up with great numbers on roi for this place so I'm not sure why it's been sitting for a few weeks now. It seems too good to be true. What would prevent other investors from rushing to this? The typical cap rate in this area is 7-8%. Granted, the neighborhood isn't amazing, probably class C tenants. Could that be the reason why no one wants to touch it? It has a new roof and vinyl windows too. I've walked it and looks in decent condition. No remodeling necessary. I talked to current tenants and they said rent is on par with market. I also looked up market rent and it was accurate.
Please let me know your thoughts or what I'm missing.
Thank you for your time and help!