Hello BPers -
This is my first post on the forums so a thousand humble apologies if I commit an unspoken faux pas like forget to complement Brandon's beard.
I've been interested in REI for a while but only recently decided to start acting on my intrigue and actually look into what it takes to make money in real estate, that's when I discovered bigger pockets. I know there is so much I don't know so I'm looking to you guys to point out my blind spots and help me see what I'm not seeing. So anyways, here's the deal:
Zillow listing
The House:
1911 3 bed 1 bath bungalow in NE Portland, lots of curb appeal. 1100sq ft. including partial basement (AKA mouse house). Potential to add a second bath in the basement to make the basement room more of a separate unit. 5 blocks from the heart of Alberta, one of the more up-and-coming areas in Portland (7% appreciation).
Here are the numbers:
Listing Price: $350,000
Offer Price: $300,000
Rehab (including basement bath addition): $15,000
ARV: $370,000
Assumptions made based on cash offer @ $300,000 and re-fi at 6 mo.
- Gross Income @ $2100/month (5% vacancy deducted): $23,940
- Expenses: $5,834 (including $3000 for maintenance & repair)
- Cap Rate: 5.82%
- Cash flow @ 4.11% 30 year term 20% down: $4,646
This is obviously not a cash cow but I feel the neighborhood justifies the low initial cashflow since appreciation is skyrocketing.
What are your thoughts? Am I relying too much on appreciation to make this a good deal?
