All Forum Posts by: Hau N.

 Wow.  Sound like there are great opportunities to invest in Texas.  Cash flow properties in California is difficult to find.  The ones with decent cash flows are located in neighborhoods that I don't want to deal with.  Thank you for the response.

 I agree.  I probably will offer much less than the asking price.  With the asking price, there won't be any meat on the bone fore me. 

 It is very close.  If I manage on my own and do the gardening myself then it'll be a bit more.  Thank you for your response.

Hello everyone,

I'm thinking of purchasing my first property ever (other than my primary residence), but not sure if it's a good deal.  This is a 1984 duplex, 5/4, located in a class B neighborhood within walking distance to shopping plazas.  I was hoping to obtain some inputs on this deal to make sure I'm not missing anything.  There is a similar unit that is currently pending.  The asking price for that was $255,000.  Thank you in advance.

Purchase/Finance

Asking price: $259,000

Down 20% = $51,800

Interest 4.5%

30-year loan term

Closing cost of 3% = $7,770

Total cash needed = $59,570

Operation

Gross rent / month = $1,900

Operating income = $1,620

Operating expenses = $625 (36.8% of income: 10% vacancy, 10% maintenance, 10% cap ex, property management %10, insurance $50, property taxes $243, gardening $50)

NOI = $1,024

Loan payment  = $1,050

Cash Flow = $35/month

Cap Rate = 5%

ROI (year 1) = -7.1%

ROI (year 2) = 12.9%

ROI (year 5) = 79.8%

-HN

Thanks for the updates.  Really enjoyed reading your post. 

Great post.  Thank you for sharing your experience.

@Jennifer Beadles Thanks for posting the table in your post.  I learn something new today. 

Great post.  Thanks for sharing your story.

Thanks @Tom Ott.  I'll keep an out of reliable companies.