[Calc Review] Help me analyze this deal

[Jose L Torres]

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

[Jaysen Medhurst]

@Jose L Torres, how confident are you in the rent expectations? I'm seeing 1/1s of similar size in the $850-925 range. The units renting for $995 are a lot nicer than your subject property.

Why do you think you'll instantly add $50k of value without any improvements? What you pay for the property is, by definition, its value.

On the flip side, why do you think you'll get it $50k below list? Looks like properties in Bradenton are selling for ~98% of list price. Either this property is over priced and you'll get it cheaper or it's priced at FMV and you shouldn't expect much discount.

Regarding your analysis:

• Put in a budget for initial repairs. There's always something.
• Vacancy, repairs and CapEx are a bit low. I use 8% for vacancy and 15% combined for repairs/CapEx.
• Management will be ~10%. Include this even if you plan to self-manage at first.
• Insurance might be a little low. Have you spoken with a local insurance agent?
• Water/sewer looks a little high, but considering the units have washer/dryers, maybe not. You can confirm with the local water department.
• What about lawn care?
• Your interest rate is VERY high. I'm seeing mid 4s for commercial loans. I bet you can get 4% or maybe even better. Call around to all the local banks and credit unions.

You may squeak $100/month out of this place, but I think you should keep looking.