Searching for a market, duplex in Indianapolis.

[Łukasz Juraszek]

Hi there,

I live in South Bay of Bay Area where I have a difficult time finding multi-unit properties that come anywhere close to 1% (most are <0.5%). After listening to the podcast 301, I figured it might be better to get started in an area with greater supply. Here's my first analysis. What do you think?

My rent estimates are based on rentdata.org

1149 W 30th St, Indianapolis, IN 46208 | MLS #21690508

Duplex, near downtown (potentially airbnb, main goal long-term rental)

Property Value	$25,000.00
Down Payment %	20.00
Down Payment	$5,000.00
Rehab	$60,000.00
Loan amount	$20,000.00
Interest rate %	3.5
Loan term (years)	30
Monthly Rent Income	$2,000.00
Taxes	$16.67
Insurance	$8.75
Utilities	$0.00
Management	$200.00
Vacancy	$100.00
Repairs	$100.00
CapEx	$200.00
Mortgage	$89.81
Cash Flow	$1,284.77
CoC ROI	23.72%
Value post rehab	$85,000.00
Cash out refinance	$59,500.00

[Ric Ernst]

@Łukasz Juraszek wow they really want to get rid of that property don't they? Despite what appears to be a bargain, you should realize that that is not a great neighborhood and, although houses built in the 1890s are totally cool, they typically need massive work to rehab....lathe and plaster walls, fuse boxes, exposed wiring, non-standard construction, etc.

I don't know a lot about short term rentals but my gut would tell me most people aren't going to want to rent this for a weekend in a distressed neighborhood. Monthly rental tenants will turn over more often than a SFR in a nicer area so you'll be putting money back into it each time that happens.

Could it be a great deal? Maybe. But there's a reason it's been on the market for 209 days and counting with the seller cutting the price to 1/3 of its original price.