Practice rental property analysis: Windsor Duplex #2

[Micah Ng]

Hey all,

I'm analysing deals on the MLS and would like to see if I'm doing anything wrong. This is a 2*2 bed duplex in Windsor, Ontario selling for $140K. Listings I see online put 2 bedroom units at between $1000-1200, CMHC indicates the average in 2018 was $900. I'll use $900 to be conservative.

A big thing to note is that this property is in the Historic Sandwich Town in Windsor. What does this mean for my property? Does this mean limited options during renovations? Will it affect my cashflow?

My Analysis:

$900*12 months*2 units = $21600 in gross rent

Less $1800 for one-month vacancy each

Less 24% in expenses (5% maintenance, 10% CapEx, 9% property management)

$15048 before taxes, insurance, mortgage

Less $988 exactly in taxes

Less approx. $1500 in insurance

$12560 in Net Income before the mortgage

Less approx. $7200 based on 4% interest, 20% down

Leaving $445 in positive cash flow. 

I appreciate any input you might have on my analysis.