All Forum Posts by: Anna Khan

Not an experienced investor, but I live close by this area.

I would speak positively of the area and believe this area is slightly improving. The nearby college is Richland community college. A mile south is a little dodgier and a mile north is suburbia. I would think rent for a 2 bedroom condo would be close to $900 depending on size, parking, and pet policy. Definitely check the CCRs to see if you are allowed to rent the unit or not.

@Anna Khan welcome to BP.  Real estate is local.  I am very far away from your market, so I can only tell you how your deal would be considered in my market.  First thing is to look at the covenants and restrictions and make sure they do not prohibit renting your unit out.  The second thing is that your taxes seem pretty low for Texas.  I would double check that.

If you were to have bought the property using financing, say 80% financed at 5% interest, say $56K. On a 30 year note your payments would be $300 per month. It would be $442 if you financed it for 15 years. When you add in your HOA fees you are at $554 per month for 30 year or about $700 per month. I will guess and say you will pay about $150 per month for taxes and insurance. I do 8% for vacancy, which would be about $80 per month. With a HOA your cap ex and repairs should be a LOT less than normal. Lets say $70 per month. I don't know where you live or how hands on you plan to be, but you may have to pay a management fee, lets say $100 per month. In my area this would be on the low end mostly because of the HOA fees. With a 30 year note it might be OK. It would help to have an idea of how new the property is, how much prices are going up etc. You can back off on needing cash flow if the market is going up rapidly. I hope this helps a little bit.

I would worry that it might be hard to deal with a month to month tenant without knowing for sure if they are reliable... and then what if you had to evict them? Can your agent ask their agent to provide you with Schedule E from their tax returns, which would show what they are claiming in terms of rental income?

I'm wary of inheriting a tenant without any evidence of the rental history...