Hi Everyone, I'm currently working with my father who is trying to close on his first real estate deal. He is not the most financially savvy and I've found myself in a make-shift financial adviser sort of position, but I feel this would be a good opportunity for me to learn the business and benefit him as well. Anyway, after much delay and shopping, we finally have our financing in place and can make an offer if a good opportunity arises. So here's my question: Is this a good deal?
Duplex and detached Studio Unit - Total of 3 Units - currently priced at $170k
Following information provided by my realtor:
Total gross rent: $1,800
Annual Income $19400 (Buyer to verify)
Annual Expense $4500 (Buyer to verify)
Income (before mortgage expense) $14,900 (Buyer to verify)
Tenant Pays All Utilities, Water, Sewer
Income Includes Unit Rent
(Expenses Include Management, Maintenance/Repair, Insurance, Taxes, Vacancy Factor) - According to seller
Our lender wants us to put down 25% - Around $43k
Mortgage payment would be around $700, bringing our net income to around $6,500
If I'm correct this would be a cash ROI of around 15%?
At first glance these numbers seem solid, but there is also some factors that are discouraging as a potential investor.
#1: The listing only has one photo of the property. All units are currently occupied, but still... 1 photo.
#2: The listing has been up since August 2017 - Any and all potential buyers walked off after inspection?
As a virgin investor, I would really appreciate any and all feedback!
Thanks!