Please critique this business plan

[Joshua Wilson]

In advance, let me say thank you for the feedback.  I'd love the good and the bad.  Balance out my expectations if parts of it also look particularly good!  Thanks to @RyanMoeller for the template from his post here.

1. Mission Statement – I work to acquire Multifamily rental properties to generate at least $5,000 a month.  Allowing me to be a stay at home father and support my wife's medical and missionary life goals.
2. Strategy – While maintaining my full time position I will acquire *plex properties at a minimum 10% cap rate.  Initially focusing on the sub$100k market and moving into larger properties as deals/income permit.  For the first two years, all profits will go into property improvement, maintenance funding for the properties, or saving as capital for further acquisitions.  Utilizing the domino affect of a growing portfolio to allow for exponential portfolio and income growth.
3. Market – Hillsborough county within 30 miles of the Tampa city center.
4. Criteria – LTV - 80%
   Annual gross income - $15,000 annual
   max purchase amount - $100,000 (Pending revision after growth)
   max rehab amount - 5% of appraised property amount
   max timeframe - 2-3 months? I'd love input on this, I am not even sure how to determine what a max timeline is or should be for buying a property. I'm treating it as maximum time from offer to closing.
   Constructed after 1985
5. How to find deals, marketing plan – Acquire my real estate license for access to MLS, agents, online searches, direct mail to lists, other? This is the 2nd biggest mistake, investors do not find good enough deals and it all comes down to marketing and persistence with their marketing plan.
6. How to finance deals – This is a grey area for me. As I'm just formulating this, I'll put my expectations. I intend to use conventional mortgages. Focusing on 20% down and loaning the rest to net positive cash flow is the goal. Seller financing if it helps skews my LTV positively.
7. How to do deals – Working with a licensed broker/realtor in my area I'll complete the purchase. Perform cosmetic repairs(paint, fixtures, or cleaning),  Hire the appropriate repairman based on recommendations from property management company, turn the property over to property management company, oversee applicant process and tenant placement,  maintain property until my cap drops below 5% then exit.
8. Exit strategies, Backup Plans – Unless capital would be used to purchase further properties, use seller financing to sell the property and maintain an additional(unmanaged) long term ROI.
9. Team & Systems – Realtor/broker to do initial screening and for acquiring properties.  Everything but the closing can be handled remotely.
   
   Property Management company - Manage tenant and property autonomously
   Using property manager vendor recommendations makes this simple
   
   QuickBooks Online with accountant access - autonomous accounting
   
   Local Real Estate Attorney -
10. Illustrate example deals – See below for description from ideal property found on loopnet.
    
    3 bed, 1 bath floor-plan. Built in 1987. Over 1/4 acre lot. Unit A leased at $799. Unit B (currently vacant) previously leased at $799 (vacated 7/31/16).
    
    Cost Analysis Performed as Rental Property
    In:
    Rent - $19,176.00 (Verified as accurate)
    
    Out:
    (Annual) Actual Taxes - $1,433.00
    (Annual) Estimated Insurance - $1,342.32
    (Annual) Property Management (Optional) - $1,629.96
    (Annual) Estimated Utilities/Lawn/Vac - $1,917.60
    Total Costs - $6,322.88
    
    Net: $12,853.12
    
    Earn:
    Total yearly net equates to - $12,853.12
    Total monthly gross equates to - $1,598.00
11. Financials – Due to my personal finances being intertwined with my financial plan, I'm going to leave this vague for the purpose of this post.  
    Income:
    Enough to cover these expenses with a comfortable buffer
    Expenses:
     ~$3000/mo($1600/mo mortgage, $400/mo car payment, $600/mo utilities/food/gas/etc..., $400 living money)

[Joe Villeneuve]

Joshua, you are making the same mistake most people make when attempting to put a business plan together...they start at the wrong end.

The areas that you have not filled in (How to finance deals, Exit/back up strategies), or are vague in (Market, Criteria) will lead you to frustration.  Here's why:

1 - You base your plan on what you can do, which is structured based on your limitations.  How do you know what the financial numbers will/can be if you don't know what your financing availability is?  How do you know how you will execute "a plan" to reach your goals if you are not sure of the strategies yet?

2 - You state the Market you are looking to invest in, but you have not stated why you chose that market...and having it the market you live in is not the right answer.  The market you invest in should be chosen based on its ability to deliver properties/deals that will allow you to achieve your set of goals...not because "I know the market".  Don't mistake knowing the street names, for knowing the market.

What you have here is actually a good start of concept of pieces to move forward.  My suggestion would be to start with getting your financing options lines up.  It doesn't matter what "plan" you come up with, if you can't fund it.  Base your plan around the funding you can get, and the market you choose based on that market's ability to deliver properties that satisfy the profile generated by your fundability.