First deal analysis

[Michaela Cheairs]

Hello everyone this is my first deal analysis and I was wondering if I;m on the right track. Any comments are welcomed. 

It's a renovated 2 story, 2 unit building I'm interested in house hacking. One unit is rented and under a new lease. The building is 109900 and has seen a 3% price drop recently. I analyzed from the standpoint of a 3.5% FHA loan and 5% interest rate with 3000 closing cost. I ran the report twice. 1 with the rental income at 625 (what the current tenant is paying and I would be in the other unit) and 2 with the rental income at 1250 (the amount after a year when both are rented).

The house hack scenario:

monthly expense:767.24

monthly income : 625

cash flow: -142.24

Cash on cash return: -24.93%

Full rental scenario:

monthly expense: 767.24

monthly income: 1250

cash flow: 482.76

COC return: 84.62%

Although I would have a negative cash flow for the first year or so I think this a great deal. I would have to pay roughly 142 per month to complete this deal for a year but I am currently renting for 790 so this would put 648 back into my pocket and it has a great cash flow and COC return after its fully rented.

I think it a deal worth doing. What do you all think? How did I do with the analysis? I am learning so much from group and can't wait to do more deal breakdowns.