Help Analyzing - Central Florida

[Ryan Lam]

Hi! I am getting closer to making offers and was hoping to analyze a live example to make sure I am offering on the right properties. Any advice would be appreciated!

Single Family Home
Rental, Buy & Hold (of course would need to cash flow positive)
New Construction
Requires Property Management (out of state)
Central Florida
Beds/Baths: 3/2
SqFt: ~1,300

List: $183,900
Mortgage Amount: $147,120
Down Payment: -$36,780 (20%)
Closing Costs: -$4,597.50 (assumed 2.5%)
Repair: $0 (new construction)
Updates: -$1,200 (needs fridge)
Rent: $1,425 (should be a conservative estimate)
Vacancy: -$57 (monthly figure, assuming 4%)
Principal+Interest: -$668.87
Property Taxes: -$230 (about 1.5%)
Property Management: -$114 (8%)
Leasing Fee: -$89.06 (assuming required annually with turnover, this figure is assuming it were broken down monthly)
Insurance: -$65
Repairs/Maintenance: -$114 (8%)
CapEx: $0 (new construction so assuming a few years should go by without it?)

If I am understanding and calculating everything correctly...
Initial Investment: -$42,577.50
Cap Rate: 4.93% 
Cash on Cash: 2.45%

Not sure if I am approaching it a bit strict. For example if rents came in at $1,450, Cap Rate: 5.29%, Cash on Cash: 4.01%

[Tyler Gibson]

Originally posted by @Ryan Lam:

@Tyler Gibson

This would be Marion Oaks specifically.

Rent estimate was $1,450 on the low end provided by the broker, I took a quick peek at similar type properties currently for rent (though just a quick Zillow search) and figured $1,425 would be pretty safe on the low low end.

I don’t know why that didn’t even cross my mind figuring vacancy to come out to be minimum 1 month. I’m assuming this would be a no brainer to assume 8% at the lowest?

The no fridge part, i thought that was odd as well. Everything else I came across would have come equipped with kitchen appliances. Now a thought just came to mind, washer/dryer need to be considered?

Should be no HOA to my understanding.

What would be a better estimate for taxes?

I would need an actual address to give you my opinion on rent estimate but 1425-1450 could be right. The closest large town is Ocala but not a ton of industry there. If the house is not in a community then no HOA is good. I would say no to washer dryer just advertise as having hook ups people can bring there own and it is one less thing you have to maintain. Again without an address, it is hard to determine taxes. Sounds like a decent deal though.