A close look at a good little investment in Stockton, Ca for $89,900
0 Comments Published by Brian W. Barringer on Wednesday, January 23, 2008 at 3:52 PM.
This bank owned home just had a price reduction. Located in North Stockton near Wilson Way.
Details: 2 bd 1 ba
1031 sq.ft
0.110 acre lot
Built in 1943
Financing thoughts:
Based on current interest rates:
30-Year Mortgage
5.31
| Purchase price | |||||
| Down Payment | 10 | % | 8,900 | ||
| Loan Amount | $80,100 | ||||
| Interest Only | $354.44 | ||||
| Private Mortgage insurance | $34.71 | ||||
| Estimated Taxes+ Mello Roos (if applicable) | 92.71 | ||||
| Estimated Insurance | 13.35 | ||||
| Total PITI | $495.21 | ||||
So with $9,000 down you could own this place for about $500.00 a month. But wait, what about closing costs? In this market we ask the seller to pay them in our offer. Below is an estimate of what closing costs might be in this transaction:
| Points | 890.00 | ||||
| Appraisal Fee | 300.00 | ||||
| Credit Report | 16.00 | ||||
| Doc Prep/Processing | 750.00 | ||||
| CLTA Title Ins | 50 | % | Buyer | 650.00 | |
| Recording | 100.00 | ||||
| Tax Service, Flood Service, Wire | 140.00 | ||||
| Escrow Fee | 50 | % | Buyer | 187.00 | |
| ALTA | 100 | % | Buyer | 295.85 | |
| Prorated Interest | 15 | days | 194.22 | ||
| Home and/or Roof Inspection, Home Warranty (optional) | 360.00 | ||||
| Estimated Insurance (1 yr policy) | 400.00 | ||||
| Down payment | 0.00 | ||||
| TOTAL DOWN + CLOSING COSTS | $4,283.07 | ||||
But how much would this investment rent for?
Craigslist.com will have up to the minute current rent rates posted by actual landloards.. I got a few rental comps:
Jan 13 - $850 / 2br - house for rent (stockton)
Jan 18 - $1000 / 2br - 2 Bd/1 Ba One Block From Miracle Mile!!! (Stockton )
Jan 22 - $1050 / 2br - Charming Spanish-style home for rent (Victory Park)
I could not find too many good examples but lets say you can rent the home for more then a condo. I would say try for $950 and go down if you dont rent it out to $850. Shouldn't go for any lower with condos usually $650-$800.
Final Thoughts:
At the end of the year considering $850 for problems and rent loss, $600 for maintainace you will be $3,350 a head of the game. Pretty good to cash flow in California. You will have your down payment back in three years. Take the profit from the rental to pay down the mortgage then sell when the market is UP!
Budget For Year 1:PITI -$6000.00
Landscaping -$600.00
Rent Loss -$850.00
Rent $10,800.00
Total Positive Cash at the end of the year is $3,350. Taking into consideration $850 for problems and $600 for landscaping upkeep.
With warm regards,BrianBrian W. BarringerYour Personal Real Estate consultant for LifeBrian@tracyhomes.com
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