Hi Investors!
I wanted to reach out to the BP community and see if anyone could help me analyze this potential deal my husband and I have.
It's a 4-plex that is fully occupied just minutes away from a large university and lake. All units are 2 bed/1 bath; 3 are rented for $725/month and 1 is rented for $700/month (long term tenant).
Asking price is $259,000 and has been on the market for 200 days.
Below are the current yearly expenses according to the seller:
Property Taxes: $3,524.00
Garbage: $840.49
Electricity (owners portion, tenants pay their own): $419.76
Water and Gas: $4,699.75
Total Operating Expenses $9,454.00/year
Here's the income:
Unit 1: 2br/1ba $700
Unit 2: 2br/1ba $725
Unit 3: 2br/1ba $725
Unit 4: 2br/1ba $725
Laundry (coin operated in building) $480.00/year
=$2,875/month rental income x 12 = $34,500/year + $480 laundry = $34,980.
My husband and I are trying to figure out if we could do a 5% down conventional loan (apparently they're still available?) Or if we should do 25% down (required for 2-4 units) and do a private or hard/money loan for the $65,000 ( about $63,000 down payment plus closing costs) and pay it back with interest over 5-7 years.
From our calculations, a 25% down conventional loan would cash flow anywhere from $800-$1000/month depending on final purchase price, interest rate, expenses, etc.
Most likely would try to lock in the property between $220,000-$240,000 for it to make sense for us.
Are these numbers showing a potential deal? Or are we missing something big (besides insurance and PM) that we need to consider that could kill the deal?
