My first investment property

[Account Closed]

Im going to buy a house worth 200,000 for 150,000

Ill get 50,000 profit but the bank will finance me the closing costs and repairs. repairs and closing costs are 10,000

Then it means my profit is

40mil not 50mil right?

[Bart Charkow]

Yes and no.  $150,000 is purchase price + $10,000 for closing and repairs.  You are in for $160,000.  The property is valued at $200,000 which would mean you have $40,000 equity in the property.  Depending upon how quickly you sell it, you may have to pay for property taxes (which will reduce your net) as well as a minimum of approximately 2% to a buyers agent (an agent bringing a buyer to the table).

Again, it depends on how long you carry and whether or not you sell it yourself or use a brokerage.  A brokerage will also charge you points in addition to the 2% you pay to a buyers agent.

$200,000 - $10,000 (closing costs and repairs) - $4,000 (buyers agent at 2%) - $4,000 (brokerage at 2%) = $32,000 (minus property taxes, transfer fee, etc)