It’s my first time! Help me analyze this deal!

[John Mann]

Hey, guys. This is my first time posting here and I’m in the middle of trying to figure out my first deal, so please be gentle!

So, a buddy of mine from high school that I know pretty well offered to mentor me in real estate investing. He’s been immensely helpful and has answered a ton of questions that I’ve had. We are going in on a flip together and he is even offering to allow me to buy my first rental property from him through owner financing. I trust him, but I also want to make a decent deal where I end up with approximately $200 of cash flow per month on the single family rental that he has offered me.

The problem here is that I cannot seem to find a way to calculate this deal in a way where I have acceptable money put back for Cap X, repairs, and vacancy, while making an offer that isn’t terribly low for the value of the home, which is approx. 98-105k.

Am I screwing these numbers up, or is this just a deal I should pass on? It’s possible that he is just trying to teach me a lesson about how “not all deals should be pursued”, but I want to exhaust my options first.

Thanks! Y’all are my last hope!

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