Let me start by saying this is my first pure real estate investment deal. We own a couple properties that started out as primary residences, but this is the first actual deal. I'm under contract for a duplex in the western Chicago suburbs.
Price: $172,250
Gross Rent: $2,000
Taxes: $4,754
Insurance: $1,450
Est Utilities: $1,500
I'm assuming $180/mo or 9% for each CAPEX and maintenance and $166 or 8.3% for vacancy. We're going to manage the property ourselves.
It's a two story building with a 3/1 on the first floor and a 2/1 on the second. Both units are occupied with leases that end in the fall of this year. The inspection was completed and I'm in the attorney review period.
The inspection report shows that the exterior wall in the front of the building may have water intrusion which is evidenced by a slight sag in the entire front of the building. The wood siding and trim appears to have a slight smile, if that makes sense. This makes me think there could be a potential mold issue in the wall.
All the windows, approximately 30 in the building are probably 50+ years old and much of the glazing is failing, the rope and counter weights in several windows are broken, and many of them stick and are difficult to open, and all are drafty.
With this being my first deal, I'm a little nervous and looking for some advice. I'm thinking about asking for the following:
Seller to do a mold inspection and remediate if mold is found.
For the windows I'm thinking about asking for a $5,000 credit for replacement.
I'm looking for folks to weigh in with their opinion. I'm open to any advice or suggestions.
Thank you in advance
