Evaluating a Rental Property
Member since 2020 · 6 posts · 0 votes
Can I get other eyes on the numbers for this deal? It looks like its very good, however I am new and probably missing something.
Description/location:
2 quadplexes in a college town, <3 miles to a centralized campus (easily bikeable), on a bus route, walking distance to grocery stores and restuarants. Having graduated from this school, its in a very good location where vacancy would be extremely low. The market has students sign year long leases even knowing most will move home for the summer and the unit will be empty (so it/when rehabbing is desired, the possibility exists to update it and use it as a perk to keep the same tenant). The units do not appear to need any renovations done, however I have few pictures/information on when it was all last done.
Numbers:
600k listing
All are 2bed 1 bath units, and in the area, renting a room is very typical
Room rents are between $550 (a room in a SF, condo, or townhome) to ~$900 (1bed 1 bath condo/apartment where you pay to live alone).
Rents for 2/1's that are not buy the room could be expected to be in the $1k range, not higher than $1,200.
No HOA
Taxes look to be around $6000 annually.
As I run these numbers, even in a near worst case (100% financing, 5% vacancy, $625 rent for the whole unit) it still cashflows. In a more realistic but still conservative estimate (100% financing, 5% vacancy, $400/room [$800/unit]) it is cashflowing a little over 1k/month.
Is there a large number I am missing somewhere? I am including taxes, closing costs, insurance, property management, some monthly expenses (its quadplexes, so trash mainly). It looks like a stellar deal to my (inexperienced) eyes. What am I missing that has had this sitting on zillow for almost 2 years?
Description/location:
2 quadplexes in a college town, <3 miles to a centralized campus (easily bikeable), on a bus route, walking distance to grocery stores and restuarants. Having graduated from this school, its in a very good location where vacancy would be extremely low. The market has students sign year long leases even knowing most will move home for the summer and the unit will be empty (so it/when rehabbing is desired, the possibility exists to update it and use it as a perk to keep the same tenant). The units do not appear to need any renovations done, however I have few pictures/information on when it was all last done.
Numbers:
600k listing
All are 2bed 1 bath units, and in the area, renting a room is very typical
Room rents are between $550 (a room in a SF, condo, or townhome) to ~$900 (1bed 1 bath condo/apartment where you pay to live alone).
Rents for 2/1's that are not buy the room could be expected to be in the $1k range, not higher than $1,200.
No HOA
Taxes look to be around $6000 annually.
As I run these numbers, even in a near worst case (100% financing, 5% vacancy, $625 rent for the whole unit) it still cashflows. In a more realistic but still conservative estimate (100% financing, 5% vacancy, $400/room [$800/unit]) it is cashflowing a little over 1k/month.
Is there a large number I am missing somewhere? I am including taxes, closing costs, insurance, property management, some monthly expenses (its quadplexes, so trash mainly). It looks like a stellar deal to my (inexperienced) eyes. What am I missing that has had this sitting on zillow for almost 2 years?
