All Forum Posts by: Brendan J.

Greetings! Be sure to check out the Ultimate Beginner's Guide on the site and ask a ton of questions. All the best!

Congrats Harry! Its exciting to see people making strides and wish you the best!

Bryan, how is the market in Cookeville / Algood / Monterrey treating you these days?

I believe there to be a difference in a warzone atmosphere (which definitely discourages tennants) and honest people who are messy and don't appreciate what they have. It doesn't sound like a warzone to me and shouldn't discourage buyers, or renters, too much.

Ask yourself if it was you that was buying the property to live in, would you be able to look past the neighbors you're describing and see the value in the property? If not, then you may have reason to be concerned.

Good to have you Chris! Check out the ultimate beginners guide as well. You'll find BP to be an incredible resource. Take care!

Welcome Latham! Enjoy you'd time here on BP!

Well, can you afford the downpayment on two homes right now? If not, its an easy call, just get the one duplex. It may not be feasible to "cash flow" the property as that would mean all expenses and debt covered, plus additional revenue streams. But you could live in one side at a greatly reduced rate for sure.

Another thing to think about is that many don't like mixing work and daily life. Meaning, you may not want to have your tenant living next to you banging on your door when something starts leaking at 9 at night.

If you can get over the situation described above, there are huge upsides to the duplex idea.

Best of luck!

I agree with Arjun above. Tripling your W-2 in 2-3 years is absolutely beneficial for your long term success. You may feel like you're losing ground now, but you'll multiply your success years from now. Remember that the amount people will loan you is directly tied to your gross income on a monthly basis. If you can substantially increase that number, it means that when the time comes you'll have more people lining up to loan you their money.

Learn all you can in the mean time and keep saving. Don't set an expectation for yourself to save $200k to $300k in the next 5 years, because those numbers don't add up. Just keep your head down and keep getting smarter.

Evan, I think you'd find it difficult to cash flow this property.

If you use the 50% rule that states expenses (everything except principal and interest) over a period of time will equal half of the market rent per month, you're looking at $1935/2 = $968 as your cash flow after expenses.

You could save some money (~8-10%) by managing this yourself, but my hunch is that with that old of a property the upkeep and capital improvements will be higher on this deal than a newer property. Let's assume you can beat the odds on the 50% rule slightly and are able to see $1,100 a month before debt service.

$1,100 - $1,335 = -$235 (negative cash flow)

The 50% Rule isn't perfect for every property on any given year, but comes damn close over a long period of time. I think this deal will end up sucking more money per month than you could stand to make.

Perhaps look for a different deal?

Welcome Frantzces! We also look forward to conversing with you! Enjoy your stay here on BP.