Please Help Analyze My First Deal!

[Nicholas K.]

View report

*This link comes directly from our calculators, based on information input by the member who posted.

This is my first rental property.  I purchased it under a VA loan with no money down.  I had to pay the VA processing fee of around $5K.  I lived in the property for two years and ended up remodeling the bathrooms doing about $15K in renovations in supplies only. I did the renovations my self after receiving a $30K non-itemized estimate from a contractor.  I saved up $10K in working funds in case of repair/vacancy and I have had the house for two years now as a rental.  

Please don't hold back on the advice, I am willing to learn. Thank You! 

[Larry Turowski]

Originally posted by @Nicholas K.:

View report

*This link comes directly from our calculators, based on information input by the member who posted.

This is my first rental property.  I purchased it under a VA loan with no money down.  I had to pay the VA processing fee of around $5K.  I lived in the property for two years and ended up remodeling the bathrooms doing about $15K in renovations in supplies only. I did the renovations my self after receiving a $30K non-itemized estimate from a contractor.  I saved up $10K in working funds in case of repair/vacancy and I have had the house for two years now as a rental.  

Please don't hold back on the advice, I am willing to learn. Thank You! 

Is your after repair value correct?  You basically are into it for full market value?  This isn't a deal I would do.  Plus your capex, maintenance and vacancy are low, 3% each, and no management.  This all gives you the illusion of cash flow.  Hopefully you'll get some appreciation out of it.  Have you heard of the 1% rule of thumb, that you want to get at least 1% of market value (some would say purchase and rehab cost, which for most investors would come out to about 20% less) for rent for it to make a good rental.

Time will heal wounds, though.  Most peoples first deal is not their best.  So hopefully you can improve from here.