Hey BP community, I recently started a thread in regards to this same post. I appreciate all of the answers and comments from everyone who replied. I am posting again because I have more information on the property and some more numbers.
My wife and I are moving to Marquette Michigan in January of 2019. She is going to be attending NMU. We currently live in Illinois, just west of Chicago, and have been here for the last 4 years. Our goal is to purchase a 2-4 unit property in Marquette in an attempt to house hack and save on expenses. I have not done any deals yet, but would like to try acquiring a multi family once we move.
We purchased our first home in December of 2016, here in Illinois, for $171,000. Just a little over a year later it is worth roughly 200K. I used a VA loan to purchase our home and was shocked to see how much it has gone up in value in just over the year that we've been here. I have thought about renting out the house when we move but per my analysis th numbers don't make sense. My goal is to sell it, and use a VA Loan to purchase a multi family in Marquette.
I recently found a 4 unit property on Craigslist in Marquette for $315,000. It is fully rented and brings in $3,125 per month. I emailed the seller for information on the property. It is an older gentleman who has owned the property for 20 or 30 years. He is looking to retire and move south. I don't blame him as the winters in the UP are rough. The property is in great shape at least from the pictures. The property has one 2 bedroom 1 bathroom unit, and three 1 bedroom 1 bath units. It is roughly 6 blocks from the campus itself and in the heart of downtown. I contacted the seller, and he said that the units are all rented. The three 1b, 1b units are rented for $700, and $950 for the 2b, 1b. I know these may not be accurate and I will have to do more research and make some calls, but I ran my analysis with those rents. My wife and I would live in one of the 1b, 1b units and rent the others. I would like to self manage the property (but factored in 10% for a property manager just in case) and would also take care of the snow removal and lawn care my self. I would pay water ($250 per month) and heat ($170 per month), and the tenants pay electric as all units are metered separately. These numbers are rough estimates that I got from a gentleman who has rentals in the area. I was told that the asking price of $315,000 seems pretty high for that area and I would agree. In my analysis I put a purchase price of $285,000 using a VA loan with no money down. If my analysis is correct we would have to come out of pocket roughly $280 each month. But, if I manage the property myself, we would save a couple hundred dollars. If we move out and rent the 4th unit we could get an extra $700 giving us positive CF. I wouldn't mind having to pay $200-300 a month to own a 4 unit while living there, but would like your opinions.
I have attached my analysis report below.
https://www.biggerpockets.com/calculators/shared/210733/53d4d28e-a710-48ec-9d1c-3a7b5938cb2f
Thanks in advance!
-Tony
