Advice on a potential purchase?

[Gregory Almy]

Hello, everyone!

First time poster here. I've been researching REI for about a year now, and I have an opportunity that I'd very much appreciate some input on. The short story: my mother's landlord will be moving out of the area and no longer wants to own the home. Some points:

- The landlord is asking for $300,000. I would put up the 20% down. A basic mortgage expense calculator tells me that I'll have monthly payments around $1,400 per month including taxes and insurance. 

- The property is an old carriage house and has four (4) rental units. These units are all in great condition and rent for $3,400 total ($750, $750, $750, $1,150). 

- I'd consider this to be a B+ neighborhood. My mother has been there for around five (5) years now, and there's almost no tenant turnover. When there has been, no space has been vacant for more than a month.

I know there's certainly a ton of information that I haven't given that would make any responses infinitely more useful, but I would love to hear some first thoughts if anyone is open.

Thank you all, and happy new year!

[Matt Lefebvre]

@Gregory Almy make sure you get information on additional expenses including annual utility costs (heat, electric, hot water, water, sewer) and if the landlord is paying them or not.  $40K/yr is great for income, but if you're shelling out $5K/yr in heat and $5K/yr in electric costs (which breaks down to $105/unit/mo), you've just eaten up almost all of your profitability or you might be cashflow negative.

Additionally, look into the costs for snow removal, lawn maintenance, trash removal, insurance, and what the annual taxes are for the property.  It is a four unit building which comes with the plus side of being able to use a residential loan (longer term, lower rates), but make sure you're not overpaying based on other 4 units in the area.

Lastly, I'd make sure the building is professionally inspected so you know if there's any deferred maintenance or any large capital expenditures that are looming on the horizon.  

Best of luck!