All Forum Posts by: Joel Heck

Thank you for the replies.

@Jason D. Thanks for letting me know about the insurance rates.

@Paul Leason Thanks for the info on the water and rehab costs. I couldn't tell from the county site if the water cost was per quarter or monthly.

Hi, I'm new to real estate investing. I ran the numbers on a property in western Michigan on the MLS, and they look good to me. Could someone verify that the numbers are about right? Am I leaving something out?

Units - 2, both 2-br/1-ba

Asking price - $114,000

Repairs - $11,000 (Property is old but one unit has been remodeled and the other is in decent shape. I know there's at least $2,000 in work I'd like to do to update the second unit. I just guessed 10% to get $11K)

Closing costs - $3,990 (guessed at 3.5% of the asking price)

Mortgage - 10% downpayment ($11,400), 30-yr fixed-rate at 4% (rates seem to be 3.6-4.2%)

Rents - Unit 1=$850 (this was the remodeled unit and was owner-occupied, I'm guessing from median rate for 2-br in the area), Unit 2=$650 (currently leased and don't know when it ends, this is below market rate)

Property taxes - $1,760

Insurance - $480 (guessed)

Property management - 8% ($1,325 annual) although I would be self-managing

Maintenance/repairs - 15% (assumed for older property - $2,700)

Utilities - owner pays sewer and water ($1,716 annual based on county monthly record)

$16,560 - gross income (assumed 8% vacancy)

$-7,981 - expenses

$8,579 - NOI

$-5,878 - mortgage

$2,701 - cash flow ($225 monthly)

Cash ROI = 10.2%

Thank you

Hi, I'm Joel. I'm completely new to real estate investing, and I live in Grand Rapids, MI. After going through some books and BP posts/podcasts, I've decided to look into buying-and-holding 2-4 unit properties around Grand Rapids, preferably so I can live in and fix up one unit.