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Updated about 7 years ago on . Most recent reply
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Sacramento California Investing Opportunity
I've recently got a free opportunity from a family member to put a huge amount of money down on a property for me as long as my sister lives with me and we can pay for the mortgage together. I've decided to take this opportunity to turn this property into a rental. The market here in Sacramento is about 350-400k for a Duplex from what I've seen and my family member is willing to give me 120k for the down payment. I was planning on finding a duplex for about 350k, keep 15k for cash reserves, 5k for closing, and 100k down so I would only be financing about 250k give or take. When talking to my local mortgage broker at the bank, I was told it is about 450-475 in mortgage per every 100k financed so with 250k I would hopefully be looking at about 1187.5 for my mortgage. If I can find a 5B2B and live in one room with my sister, would it make sense to rent out to tenants by rooms. I have a couple of buddies who would be interested in living there. Average rent per room in Sacramento from what I've been paying is about 600-750. If I were to rent out the other 4 rooms for 500 or 600 each then I would have about 800 in cash flow. However this is excluding expenses, and thats where I am stuck. What is a good way calculate expenses and would something like this make any sense, especially in a market like California? Id appreciate any feedback good or bad! Thanks!