All Forum Posts by: Alex Costas

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Thanks for the advice Roy.

From what I had understood before, the 50% rule is usually used to estimate operating expenses -- maintenance, taxes and insurance, no?

If I'm mistaken in this it is clear that $900 will not cover the $1350 monthly mortgage+insurance+tax payment. If not then it should theoretically cash flow at ~$200 a month?

Purchase Price: $150k (pre-appraisal, haggled down from $160k)

Cash to close: $13k (including $3800 hazard insurance premium, which seems quite high)

Monthly Payment: $730 P&I + $320 Hazard + $230 Property Tax + $100 Mortgage Insurance = $1,370 total.

Rents: 3 x $675 = $2025. Installing washer/dryers may raise rent.

2,250 sqft 6/3 -- each unit is a 2/1, two stacked in a 2 story structure, the other as a front house.

Property located in Lealman neighborhood of St.Petersburg Florida.

What do you all think?

Hi all, new member here looking for second and third opinions.

I am looking at a property in the St. Petersburg area, hoping to live inexpensively.

Stats are:

Purchase Price: $150k (pre-appraisal, haggled down from $160k)

Cash to close: $13k (including $3800 first year hazard insurance premium, which seems quite high)

Monthly Payment: $730 P&I + $320 Hazard + $230 Property Tax + $100 Mortgage Insurance = $1,370 total.

Rents: 3 x $675 = $2025. Potentially 3 x $750-$800 with installation of laundry facilities in each unit.

Using the 50% and 2% rules I should only pay ~$101k for the place, and the cash flow after maintenance is added will be $2025 / 2 - $730 = $283/mo.

Considering that I would be house hacking it would reduce my cash flow to -$392.5/mo.

This seems like an acceptable 'rent' considering I will also be having my mortgage paid for me. Could it be that I am underestimating the maintenance costs with the 50% rule considering that the insurances and taxes are so high?

What do you all think of the deal?

P.S. In moving to this new location, my current residence will be free and rented out for ~$800-$1000 per month. This is independent of where I move though, so I have omitted it from my calculation.