If you’re planning on using an FHA loan, you need to read this. Do it right now, it’s short and to the point:
Here are the top five points:
-Focus on enforcement and lender accountability
-Reduce the maximum seller concession from 6% to 3%.
-Raise the minimum FICO score.
-Increase the up-front cash for borrower (it isn’t clear if this is an increase in the downpayment, currently a minimum of 3.5%, or requiring the borrower to pay more fees).
-Increase FHA insurance premiums.
This one went quick-total of 14 offers with the winning offer being all cash and “significantly” higher than the list price according to the listing agent.
I couldn’t get an exact number out of him. but if this buyer closes it, I will know in 35-40 days or so. All of this happened on the 23rd of December, which is supposed to be when the market is at it’s slowest, right!?
I just got back from shooting some video on a sweet little duplex in Golden Hill. List price: $234,800
Yep. You can own a solid investment property for under $300,000. Heck, even a HOUSE in this area under $300,000 is good deal.
VIDEO:
MAP: By the way, it looks like it’s really close to the 94. It’s not, the property is situated on top of a canyon above the 94.
Let’s Talk Numbers:As always, these are estimates! Please do your own due diligence as well-I work very hard to present honest and conservative scenarios, but I don’t know your own personal situation!
I talked to the agent yesterday, one bs offer, nothing else as of 24hrs ago. I have not been able to reach him again today. Let’s do the numbers:
Say on the not too high, not super low side each unit rents for $850. You get off street parking, garage storage space, washer and dryer, so that should be pretty easy to get.
The list price is $234,800, I think a conservative (i.e., high purchase price) number for this is at least $265,000. So let’s do the loan at 5% assuming owner occupied financing with 20% down. A 30 year fixed principal and interest will be $1,138. Plus $221 for tax. You’re clocking in at $1,359 total.
I’m assuming this would be self managed and am not including a 7% management fee, and as this is 2-4 units, not commercial loan is required. Your gross rents are $1,700, subtract the monthly payment, and you’re left with $341 POSITIVE CASHFLOW per month. Knock off the $41 for the heck of it and insurance, and you’re still up $300 bucks per month.
If you live in one of the units, you’re at $509 per month, with insurance, $550. This is your monthly payment. Unbelievable.
Pretty cool! This place pays for itself, and if you live in one of the units, you can do it for less than it would cost to rent it!
See how this investment performs over time!
Call me if you have any questions: