Rental Property Evaluation!!!
Hi,
I am very new to investing. I am about to close on my first rental property. It is a 3BR/2BA, 2-Car Ranch Duplex. 1220 square ft on one floor. I am purchasing it with only 4% equity but intend to hold it for a while. The neighborhood is close to a high school, a new shopping complex and two major employers in the town. And it was built in 2001. Fair market rent is $1000.00 and I will be asking for $975.
I know this is not enough detailed info to make a totally accurate assessment but can anyone tell if this deal "feels" right? Are there things I can do to evaluate this deal any closer?
Please feel free to let me know if you need more information to answer my question. Thanks in advance for your help.
JS 
Need to know a little more info, like mortgage payment, taxes, insurance, assoc. fees ( if any ), any fix-up involved ( probably not, being that new ) and if you already have any potiential prospects of renting that out. Don't like the little equity, but there are some places where it is better to rent some houses out (i.e. make more money in the long run ).
Mike
What part of the country and what do you think the annual appreciation will be? What is the sale price and how do you know you have equity? 4% less than appraisal?
Thanks for your replies.
I am looking at an interest-only mortgage which would make my total payments about $800 (Interest, taxes, Insurance and HOA dues). My estimation of 4% equity is based on the appraisal. However, the comps pulled by my Realtor show about 8-10% equity. I don't entirely trust the comps because I believe sales prices are very subjective and the realtor could be only interested in their commission.
Thanks.
I wish you well on the property, please let me know how it turns out. That would not be something that I would buy, but it is a new house and should give you little headaches once rented out providing you get good renters.