All Forum Posts by: Kyle Kierpaul

@Jamiel Strickland

What are the details on this Saturday's meetup?

I just purchased a place in highland park/Detroit and plan to use this at first as a primary home as I repair/remodel it. After a year or two I would like to move and rent it out. I currently own a house in the Port Huron area that I will rent out when I move into the highland park house. This will be the start of my journey of buy and hold investments. The house in highland park needs a few small items before I can live in it and I'd like to be in it before the end of the summer. My question is I started looking around for insurance for the home and its anywhere from 1300 a year to 1800 a year. Are these prices pretty close to normal and what are others doing for home insurance in the Detroit areas? From talking to progressive, state farm, and AAA one reason insurance is so high in the Detroit area is that a lot of homes are not insured.

@Jamiel Strickland

I drove past the house the other day and the street didnt look too bad. There are a few other houses that look to be in rough shape but it's not the worse street on the block I dont think. The house might need more work than I originally thought though. The realtor told me the back door was open and I could just go in to view it. When i went it looked like they recently put on new locks. So I'm working now to setup a time to view the inside hopefully tomorrow. Then maybe I'll have more of an idea of what it might need

@Jamiel Strickland,

Good point I'll take a drive by tomorrow after work. I'm also working on setting up a date to see the house, with Thanksgiving this week it might end up being over the weekend or the beginning of next week.

ok thanks for the reply, I'll have to call around for insurance quotes i was kind of guessing comparing to other annual insurance prices posted online. I'll call around first to get actual quotes and rerun the numbers. I haven't contacted any PM companies yet either, I am really hoping to do this one on my own but from what I've read it's still a good idea to include it in your analysis just in case one day I decide to go that route. That way I figured my estimate was 10% of the rent plus 50% of the first months rent dividend into 12. I can use you number at 80% to be more conservative 

Hello everyone, 

 First time post here, I have been interested in making the jump to purchase my first rental property now for awhile. Its a scary choice but I think if I start off with something on the lower price scale it wouldnt be a huge risk, besides the possibility of larger repairs earlier maybe. There is a lot i need to learn and this forum and the podcasts have helped me out a lot so far. Now im ready as ill ever be to start the journey. I feel if I i dont start somewhere ill be one of those people that always talk about it but never actually do anything. 

I have found a place id like some input on, It is a duplex in the Detroit area of the Morningside neighborhood. It seams like an area that is starting to improve and is pretty close to the Grosse Pointe areas which are pretty nice and pricey here.

The asking price on the property is $46,900. 

Im estimating closing costs to be $2500

The add says it should be able to rent for $700 each side so being conservative I estimated at $600 each side for a total of $1200 per month. 

I am hoping to negotiate the price down a little but to keep things conservative I estimated a down payment of 20% on the full asking price. Which would be $9380. 

Im estimating the taxes to be $1440 per year or $120 a month. 

Vacancy at $200 a month (not sure how to calculate so I figure if its vacant for 2 months a year that would equal $2400 loss on rent divided by 12 months?)

insurance estimated to be around $25 a month

Repairs estimated at $100 an month

Cap X I put at $200 a month

and I included property management just in case i decide to go that route at $170 a month.

Zillow says the mortgage would be about $188 a month 

That would put a total of $1003 a month in expenses and 1200 a month in rent

cash flow would be $197 a month if all the calculations make sense.

total cash needed would be $11,880. 

I get a cash on cash ROI of 19.89% with these numbers.

With all this said I think it looks like a good deal, do you guys think there is anything im overlooking or anything else I should consider in analyzing this deal? Any tips or advice? 

https://www.biggerpockets.com/buy_and_hold_results...