The numbers don't work, do they?

[Ryan Daniels]

This is the closest thing I have to a deal right now, but I don't think the numbers work. Let me know your thoughts..

General info:

Duplex, investment property, not owner occupied.  

Goals- Buy and hold, diversify income streams, set up passive income to retire early before 401k funds are usable. 

Financing: Conventional 30yr fixed at 4.75%

Purchase price: 215,000

Down Payment: 43,000

Loan Amount 172,000

Closing costs: 3,000

Total outlay: 46,000

Income:

Monthly rental income:  (700+700) = 1400

Monthly expenses (please critique my % allocations, based off BP calculator recommendations):

Mortgage: 897.23

Vacancy 5%

Prop Mgmt: 8%

Cap Ex 8%

Repairs/Maint: 8%

Water $60/month

Prop Tax: $125/month

Insurance: $77/month

Results:

Fails 1% rule (Needs 2k in rent or 140k purchase price)

Fails 50% rule

Cash Flow -$165

CoC Return -4.3%

https://www.biggerpockets.com/...

Bad deal as is, huh? 

[Bruce Woodruff]

Bad deal as is, huh?

Doesn't necessarily matter....do you like it? Does it have long-term potential? I wouldn't pay to much attention to arbitrary rules like the 1%...

Just my .02