Toledo, OH Property Analysis

[Michael Temple]

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Here is a different deal that popped up this morning. So using some advice from my last analysis and comments I got back I increased my expenses for vacancy and lowered my assumptions about income growth to 1% as well as increasing my mortgage rate to 4.5%.

Pros

Nice part of town

Good school district

Turn key ready, start renting from day one no rehab or expensive borrowing of hard money.

Cons

No real discount from market value. It is pretty much worth what it is listed for.

A little dated inside, but since it will just be a rental and not a flip I am not too concerned with this.

No way to "recycle" my cash like I would do with a BRRRR deal. It will cost me about 14K from my reserves.

It seems that almost every property I put in the BP calculators for either BRRRR or rentals come back as OK, not terrible, not a "killer deal" just average.

This deal does cash flow, but not by the $200 which is my general target. The upside is I don't need the cash flow to live on so I can plow it back in along with cash from other rentals to pay it down. At 65K, I should be able to pay it off in 15 years with no problems maybe sooner at which time I would have much better cash flow for retirement, which is what I am really after. So my thought is do I take a "marginal" deal to get moving in the right direction or keep looking.

Now before someone comments and says I am trying to force a deal to get started this isn't entirely correct. Yes, I do want to add another house to my portfolio, but more importantly I know that real estate is a "get rich slowly" strategy. It takes time to really start making money. I have retirement set about 15 years from now so I need to get time on my side and the longer I wait the less of it I have to pick up assets and get them paid down before retirement.

So with all of that in mind, thoughts?