First purchase advice

[Tony Gazetti]

Hello all!

So I'm still in the process of finding my first rental property. I put in an offer on one that looked like a good opportunity, but it didn't pan out. That offer allowed me to discover that there are quite a few more opportunities out there for what I'm trying to do. However, I wanted to run my thinking past the community to get some feedback on my thought process.

These calculations represent a realistic purchase that I could make in the area I live. It assumes a purchase price of $140k with a down payment of $50k, resulting in a loan of $90k and a total payment of $857. The payment includes taxes, interest, insurance, 8% vacancy, and $50/month of repairs. I did NOT include CapEx in my total monthly expenses number, which is the reason I want more experienced investors to check my numbers. The box in RED is how I figured CapEx into my Total ROI. I assumed an extremely high CapEx over 18 years (2 washers, 2 dryers, 2 fridges, 2 water heaters, 2 water softeners, 2 dishwashers; 1 furnace and 1 AC unit, and 1 roof). With that conservative estimate of my total all in cost, and a pretty conservative estimate of only 3% annual appreciation on the property, I'm still at 7.33% ROI when you factor in the cash flow income (which is also conservative, because I didn't account for any rent increase over 18 years).

Also I should note that I am already approved at 4.75% for the loan, so that part is not an issue.

Is there anything I am missing? It seems like a pretty solid plan, and if anything goes better than I projected here, it could be even more solid. Thank you for taking the time to review and any advice you can give!

Tony