Is this a good buy?

[moneyismyservant]

2 blocks or 5 minutes walk from University

asking price $214,900

Decent condition. Reno`s are not necessary.

20 yr old free hold town house. Needs new roof in 10 yrs.

Electric heat

Looking to rent out the 5 rooms (to students on a 1 year contract) and have a shared kitchen. Rooms will be $575 each util incl.

Utilities are estimated at $2000 per year.

Is this a good buy?

 

[terri]

QUOTE (moneyismyservant @ Jun 18 2009, 10:13 AM) 2 blocks or 5 minutes walk from University
asking price $214,900

Decent condition. Reno`s are not necessary.

20 yr old free hold town house. Needs new roof in 10 yrs.

Electric heat

Looking to rent out the 5 rooms (to students on a 1 year contract) and have a shared kitchen. Rooms will be $575 each util incl.

Utilities are estimated at $2000 per year.

Is this a good buy?

hi

wondering if you can supply some more information:

how much are taxes?

what will the insurance cost?

does that utility cost of $2000/yr include hydro, water and gas (if any)?

what is vacancy like in the area?

does the 1 yr student rental cover all 12 months or just the school year? sept -april/may?

how much did you budget for painting and repairs in between each school year?

 

[invst4profit]

$2875 gross looks fairly good with a rough estimate positive cash flow of $300 - $400 per month. This would be roughly based on a 5% mortgage on $220,000 ($214,900 plus closing) with 50% expenses.
More details would assist in refining these numbers.
Since I do not deal with student housing advice from experienced investors would be of more value.

 

[moneyismyservant]

QUOTE (terri @ Jun 18 2009, 10:02 AM) hi
wondering if you can supply some more information:

how much are taxes?

what will the insurance cost?

does that utility cost of $2000/yr include hydro, water and gas (if any)?

what is vacancy like in the area?

does the 1 yr student rental cover all 12 months or just the school year? sept -april/may?

how much did you budget for painting and repairs in between each school year?


Taxes are $2200 (in the mortgage)
Ins is $80 per mo
Utilities of $2000 annual includes, water, electric (no gas)
Vacancy is 1-3 % dependant on the tme of year
The student is required to pay for all 12 months
Painting and repair budget is $3000

 

[Thomas Beyer]

likely yes .. if impeccably managed !!

who will impeccably manage this property ? buy only if you love to do this property management yourself AND are good at it .. or if you know someone will do a good job ..

exit in, say 5 years, will require a complete reno with 5*5 student traffic over 5 years .. so put this into your analysis !

 

[invst4profit]

Do you have your financing lined up in advance?

It could be difficult.

 

[moneyismyservant]

QUOTE (thomasbeyer2000 @ Jun 18 2009, 12:09 PM) likely yes .. if impeccably managed !!

who will impeccably manage this property ? buy only if you love to do this property management yourself AND are good at it .. or if you know someone will do a good job ..

exit in, say 5 years, will require a complete reno with 5*5 student traffic over 5 years .. so put this into your analysis !


I respect your advice Thomas. Thank you for your input. I have read many of your posts and aspire to be as knowledgeable in regards to real estate as you are!

 

[housingrental]

Looks like a great deal.
Where is this?
Utilities seem very low for electric heat and a five bedroom place - in bc?

 

[Mike Milovick]

Does this property meet your investment objectives? (ROI, Top Ten City, Long Term Appreciation).

Are your projected rents in line with market rents? You may want to check the Universities` off campus housing and determine if the rents are realistic.

Does the property line up from a legal perspective? I.e. you are not offside of zoning, electrical or fire?

Mike

QUOTE (moneyismyservant @ Jun 18 2009, 12:13 PM) 2 blocks or 5 minutes walk from University

asking price $214,900

Decent condition. Reno`s are not necessary.

20 yr old free hold town house. Needs new roof in 10 yrs.

Electric heat

Looking to rent out the 5 rooms (to students on a 1 year contract) and have a shared kitchen. Rooms will be $575 each util incl.

Utilities are estimated at $2000 per year.

Is this a good buy?

 

[BrianPersaud]

QUOTE (moneyismyservant @ Jun 18 2009, 12:13 PM) 2 blocks or 5 minutes walk from University

asking price $214,900

Decent condition. Reno`s are not necessary.

20 yr old free hold town house. Needs new roof in 10 yrs.

Electric heat

Looking to rent out the 5 rooms (to students on a 1 year contract) and have a shared kitchen. Rooms will be $575 each util incl.

Utilities are estimated at $2000 per year.

Is this a good buy?

I think you`re utilities are off...with electric heat i would look at least $100-$200..possibly even $300 a month for hydro alone. For rooming houses, oh momma $$$$...you got to keep the whole house heated because all areas will be occupied.

Whats the garbage situation? are you in an area that limits the amount of bags you can have?
Zoning issues? How does the city feel. Check if there are any issues with the city...check police activity as well.

Be really careful about the area. Once you past a certain street students have this big psychological barrier that it`s too far.

 

[BrianPersaud]

QUOTE (BrianPersaud @ Jun 19 2009, 12:28 AM) I think you`re utilities are off...with electric heat i would look at least $100-$200..possibly even $300 a month for hydro alone. For rooming houses, oh momma $$$$...you got to keep the whole house heated because all areas will be occupied.

Whats the garbage situation? are you in an area that limits the amount of bags you can have?
Zoning issues? How does the city feel. Check if there are any issues with the city...check police activity as well.

Be really careful about the area. Once you past a certain street students have this big psychological barrier that it`s too far.

Visit the competition too... see what they are offering the students