11plex under contract, should I go ahead?

[Julio C.]

The Facts: I have an 11 unit property under contract with 8,200 sq. It is in the McAllen area in South Texas, almost on the border with Mexico. The price is $480k. Monthly rents are $5,330 with an empty $750 unit, so total monthly income would be $6,080. They are a mix of 3/2, 2/2, 2/1 and 1/1. Taxes and insurance are $923. $1400 for Capex (5%), Vacancy (5%), Repairs (5%) and Management (8%). There are also water and garden costs of $450. The NOI is $39,700 yearly. The inspection is scheduled for the following week. The property was built in 1920 and has been recently remodeled.

My goals have always been the same: 12% cash to cash and more than $100 per unit in monthly free cashflow in multifamily properties with something between 4 and 30 units. Buy and hold looking for cashflow.

Now let's get to the interesting thing. My goals are met by investing in this property and financing 75% with a mortgage.

Questions:

Should I stop the investment due to the crisis that was generated in the previous weeks?

I have the possibility to buy the property completely without the mortgage. This would not meet my goals, but I think it would be a safer investment these days. Is that so?

I am afraid that I am buying at a high price, even if my goals are met. I think prices are going to go down because of the crisis that is starting. Should I buy and stick to my plan?

If I decide to go ahead and buy the property, how should I prepare to get out well in the face of the coming economic crisis?

I thank you very much for your advice in advance, I have no experience in this as I have always invested in sindication deals and not directly like this.

Regards!

[Chander Mishra]

Given the current situation, the loans are getting difficult to get and it is difficult to assess the impact on employment, job growth till this all settles down. Assume a higher vacancy and a higher interest on loans to offset some of the issues you may face. If it all works then you go ahead. I am assuming you know the area very well and understand the market dynamics