Rental Monthly Income $4,800.00 (8 rooms x 600) ------- 4800 x 12 = $57,600.00 Monthly Gross Operation Expenses Mortgage950.00 Taxes191.00 Insurance 166.00 Maintenance Housekeeping 216.00 Landscaping 60.00 Repairs 10% - 480.00 Operational Electrical 350.00 Water 150.00 Cable/Internet 150.00 Reserves 10% - 480.00 Total - $3,193.00 Annual Gross Operation Expenses Mortgage11,400.00 Taxes2,292.00 Insurance 1,992.00 Maintenance Housekeeping 2592.00 Landscaping 720.00 Repairs 10% - 5,760.00 Operational Electrical 4,200.00 Water 1,800.00 Cable/Internet 1,800.00 Reserves 10% - 5,760.00 Total - $38,316.00 57,600.00-38,316.00______________NOI $19,284.00 19284.00/46,000.00 (down payment) = 41% Cash on Cash Return (CCR)

Hello Rohan, I'm sure you're aware of how expensive and how low cap rates are here in LA.

This leaves $3,350 / month after half of the income has been spend on expenses.

I am currently making 16/hr and after doing a little looking around, it seems that the properties in the SLC area are rather expensive (around 200k), especially for someone like me who is starting out.

Then you probably want to make sure there are several carriers (in case one gets too expensive or drops you, which one did after a fire claim).

Property that is way too expensive for your budget, or outside of your criteria are also a waste of time.

They are expensive, but a good resource and can usually close quickly (which can be a necessity with many deals).  

What are your thoughts on the pros/cons of making another principle payment with the extra cash from your roommates rather than using it to pay for the operating expenses and capital and living for free that way?

Everything is really expensive right not so not the easiest time to buy but if you find a deal that works it shouldn't stop you.

The deal is as follows: Eightplex in Hickory NCAsking price $210,000 (trying to get it down to 150-170k, but am using 210k for the numbers) Gross rents: $2,900/month or $34,800/year (Between $330-400 a door) Tenants pay all utilitiesI am requesting a 1040 schedule E and the T12's from the seller, but for now am forced to use the 50% rule. using that, operating expenses are $17,400 NOI: $17,400Cap: 8.28 Debt Service: $8,700Equity Dividend rate: 16.5% The area isn't great or terrible, probably a C or C+ area.