My deal of the week last week was a townhouse that is very similar to a deal I just completed. I did a tour two weeks ago prior to the renos being complete, so here is a video tour now that it is done.
And here are the numbers in case you are curious:
208,500 cash purchase(private financing).
$5000 for paint, counters, fixtures, install dishwasher, paint.
New mortgage at 2.88% for 30yrs for $161250, payments are ~$650
2nd mortgage $400. P&I
Prop Manage $187
TOTAL EXPENSE: $1725
Lease agreement signed for $1877. DD and 1st mo already paid= $2815.50.
Cashflow is about ~$150/mo on a fully leveraged property!
The trouble with fully leveraged property is that the ROI is infinite, so suppose 25% downpayment were here($53,750), cashflow would be about $550/mo($6600/yr), mortgage repayment is $~3000/yr.
That is $9600/ $53,750 = 17.9% ROI/yr . Not bad, but if you factor in appreciation(these places will be $250,000 within 5 years) ROI gets closer to 30%.
These are great little deals, pick one up before prices rise too much(previously bought for $187K, now selling for $208K!!)
Until next time,