First Deal in the works (woohoo!). Homerun? Good? Bad?

[Nathan Jackson]

Hey guys!

My wife and I are fairly certain that we're going to be moving forward with our first deal shortly. If everything checks out, we will be buying a house from a relative who wants to retire. We're completely new to this, but trying to make our first buy. Sorry in advance if anything i say or estimate is way off base.



The house is located at 510 Ansley Dr. Fort Wayne IN

Our offer is for:  Seller financed purchase. Total cost being $40,000 with 10% down payment. We would also add a deed restriction for if we ever resell the property, the owner would receive a % of the future profit (Likely between 10-20%, this is still being negotiated).

It's a 3/1 on roughly an acre of land. Biking distance to Fort Wayne's Upscale Mall.

Current property taxes are roughly $1,000/year
Current owner pays $350/year for insurance.
Current Tenant is paying for electric and sewer (House is on a well, so no water).

We think the property will need $10,000 of work to be ready for a short term rental (Air cons, some drywall work, moving/updating the well, landscaping)

Our ideal plan is to turn it into an outdoorsy airbnb with a nice backyard feature. 3+ bedrooms in the area go from 60-120/night with ~68% occupancy on airbnb. We're conservatively estimating 70/night with 50% occupancy.

Our estimated gross short term rental income = 1050/mo
Our estimated gross Long term rental income would = 750/mo

Our estimated expenses are at $400/mo


TLDL:

-Total Price = 40,00 + 10,000 reno
-All in cash = $14,000
-Estimated Cash flow = 650/mo
-CoC return = 55%
-Falls within 2% rule.
-ARV = (We really have very little idea on this as there are not many similar properties.... and we're newbies. From my research, I think it would be anywhere from 70k-120k)
-Bonus upside that it's located between commercial districts and could have a potential land buyout in the future.

Home run? Good deal? Bad deal?

Thanks guys!