First Duplex at 180k

[Sergio Montoya]

Like the title says, I'm looking to make my first real estate investment. I have about 20k saved in personal funds and was recently pre-qualified for an FHA loan of 250K at 5% down.

I'm looking at purchasing a 180k duplex with 2 Unit - 1b 1b.

I wanted to ask the better pockets community on what I should look for or consider before deciding if this is a good deal or not.

[Elizabeth Pruett]

Hi Sergio, PHX is a super hot market. 

Suppose you are doing the BRRR method, some questions to ask yourself are: what are the comps in the surrounding area? I like to stick to comps less than a mile away or in the same neighborhood. Next question is the location of the property: Since the property you mentioned is a 2 unit, 1b 1ba it may be better suited for a single couple or single person, so try to figure out what is near the location (hospitals, college campuses, shopping, dining, etc), Now that you have figured out the location, look for market value rents in the area - I believe RentOMeter.com will give you some free rent info as a first time user (BiggerPockets Pro has a pretty solid rent calculator, if you ever decide to get your Pro Membership) - once you figure out the rent for each unit, do your due diligence and determine if the numbers work out. Meaning do the rents cover your mortgage and expenses(vacancies, maint., etc), leaving bit of cash flow for ya. Since you are doing an FHA loan, you will only be able to rent out 1 unit (initially), but if you move out in a year or so, you can do it all over again and continue to acquire multi units and house hack em. Hope that was helpful.