My mortgage broker got the appraisal back today and it was lower than expected. I think the original appraisal I got when I bought the place was for $90,000. This one came back at $81,000. I guess that explains why the original appraiser was not willing to re-certify his previous appraisal. What this means to me is my refi loan cannot be as much as I wanted. (Well, if I wanted to exceed the 80% LTV ratio and pay PMI, I could still get my original amount, but I don't want to do that.) So I need to come up with an extra $2,000 at closing. Not a big deal, but not something I'm too happy about. I've re-run the numbers based on this new data and this is what I come up with now:
Purchase price: $77,250.00
Taxes: $82.42 ($989 a year)
Prop. Mgt: $75.00
Insurance: $34.92 ($419 a year)
Maintenance: $0 ($250 first year, pre-paid)
Mortgage: $403.75 (30 year, 6.75%)
Monthly profit: $153.91
Let me explain the maintenance figure a bit. When I signed up with the property management company, I had to establish a maintenance deposit of $250 with them. Any repairs will be taken out of that amount. Since I had budgeted $20 a month for maintenance, this is pretty much the amount for one year I planned on, but since I had to pay it in advance, I'd added that $250 in to the purchase price for the calculations. I believe this more accurately reflects the situation.
The ROI figure is based on a $15,000 down payment, which includes all the closing costs. The interest rate has already been locked in, so I know that's a valid number.
Also, while pulling some past numbers for this analysis, I went and applied labels to some of my old blog posts that didn't have them. For some reason, this caused those posts to show up again at the top of my RSS feed. Sorry about that, but I don't think there is a way around that with Blogger..