Posted by Nick on July 26, 2001 at 06:07:05:
I guess the reason that 0.75% would make the deal bad is because you are living in one side. By living in one side of the duplex you are eliminating half of the income.
If living in the property is your goal. I would execpt a $100 to $200 negative cash flow. How many people can buy a duplex have a place to live and build up good equity all for $200 a month.
However as a general rule for investing, if 0.75% changes the cashflow to negative that is a bad investment. The numbers should never be so tight that you ask the question “Will I make money?” The question should always be “How much will I make on this deal?”
Hope this helps.