Re: Buying property
Your actual payments would be in the neighborhood of $1860 with 5% down. That is an older building, so include about $3,200/yr in maintenace. How old is the roof (4K), AC (2K) and heating system (2K)?
What would the other units rent for, and how is the rental market there?
Lastly, look at the ROI:
You will "pay" about $16,000 for this (5%, closing costs wrapped into it, add $4,000 in tidy-ups including washer/dryers, paint, etc. which you will get as cash back to a contractor). It will appreciate roughly 3%/year, or $14K. Keep in mind you pay 6% to sell. If you can easily rent the other apartments for $600, it is a good deal for you provided the neighborhood isn't bad (it will be at best fair) and the schools aren't bad. Shop around, figure out if it's a good deal, verify rents, do not trust any owner who says they are rented out, talk to the current tenants, etc. Do your homework. If they rent for $700 inspect it and grab it. Assume the owner is in distress and offer way lower than asking. Again, be careful, because often owners will wait until there are two good one-year tenants then price the property as if it will rent full time at a given rate. Nobody lies like duplex/triplex owners.
Why are people downtalking it? It's better than my first two apartments.
Matt
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