First Rental Property

Hello Friend,

I hope you are keeping well.

One of the most common questions I get asked is, “What type of property should I buy?”

Today, I have made it easy for you as I am giving you the exact answer.

The answer is:

Townhouse

If you are a new real estate investor wanting to buy your first rental property, you should buy a townhouse.

The first rental property that I ever purchased was a townhouse.

If you are residing within the Greater Toronto Area, or are looking to buy a rental property in the greater Toronto area, then this deal is for you.

The deal I share with you in this blog post reminds me of the first rental property I purchased back in 2005.

If you are serious about buying your first rental property now and want to know about more deals like this one contact me at NEIL@FIRSTRENTALPROPERTY.COM

Happy Investing!

Neil

Location:  Oakville, Ontario, Canada

List price: $389,900

Potential purchase price: $380,000

Downpayment: $76,000 (20% of purchase price)

First Mortgage Amount: $304,000

Mortgage Terms: 5 Year Fixed Rate at 2.84%

Mortgage Amortization: 35 years

Monthly Mortgage Payment: $1,140.18

Property Taxes (2012): $2,861/year –> $238/month

Property Insurance: $50/month

Association fee: $42/month (snow removal, exterior building insurance)

Total Expenses: $1,470.18/month

Current Market Rent: $1,600/month

Monthly Cash Flow: $1,600 – $1,470.18 = $129.82

Annual Cash Flow: $129.82 * 12 = $1,557.84

Mortgage Balance at end of Year One: $298,834.29

Mortgage Paydown at end of Year One: ($304,000 – $298,834.29 = $5,165.71)

Appreciation at end of Year One: (3% * $380,000 = $11,400)

Total Cash on Cash Return at end of Year One: $1,557.84 + $5,165.71 + $11,400 = $18,123.55/$76,000 = 23.8% ROI

23.8% Return on Investment

(Here are some pictures of the property)

If you are serious about buying your first rental property now and want to know about more deals like this one contact me at NEIL@FIRSTRENTALPROPERTY.COM