So I made an offer to this two bedroom, 850 sqft condo. It was initially asked for $35,000, and then reduced to $29,900. I offered $25,00, and it was accepted.
Condo: $25,000
Closing cost: $1,000
Total purchase price: $26,000
Rent: $700/month
Vacancy: 10%
Property Manger: $56/month
HOA: $312 (ouch!) /month
Insurance: $40/month
Property Tax: $42/month
Repair: $50/month
Net before interest: $130/month
Interest: $65/month
Net: $65/month
Seed money: $0
Percentage of return: $65/$0 = ???
Haha, the profit is one meal for a family of four per month. I will take it since it is free.
History of the unit:
Built in 1969
Sold: July 1983 for $41,900
Sold: Dec 1987 for $32,000
Historical high: $130,000 (this is only my guess based on other sales. This one has not been sold since 1987).
This property is in Florida. All I hope for is: one day, it will recover to half of its peak price, and the rent will go back to $850/month.
