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Updated over 9 years ago,

User Stats

63
Posts
44
Votes
Devin Beverage
  • Lender
  • Tampa, FL
44
Votes |
63
Posts

Purely as an example for a beginning investor: Why and why not purchase this property?

Devin Beverage
  • Lender
  • Tampa, FL
Posted

I'm completely new to BP, the world of real estate investing, and all the math and strategizing that's involved, but I'm determined to make REI a major aspect of my life in the long term. To prepare myself I've been looking around at the different real estate listing sites, various places teaching "the basics," and trying to scout forums to eavesdrop on pros living the dream (which is how I found BiggerPockets).

I'm really excited to get started, but I don't want to get into something prematurely over my enthusiasm, so I'm taking my time to make sure I know how all the finances and rules work. If you know of good places to get comprehensive lessons on what formulas I should know, books that teach real-deal laws, rules, etc., please point me in that direction!

Anyway, I have seen several properties in my target area that are listed as "tenant occupied," where the rent (when they give that info) meets the 1% rule, the listing price for the home is below Zillow's "Zestimate," and the tenant has a good amount of time left in the lease. I've selected two (same condominium/complex) that look to be in the best shape to use as an example for general things to pay attention to when searching for investments, and I'd appreciate some advice. I'm not looking to buy these two units (unless they're still on the market in 3-6 months when I feel I'll be ready), so I'm not asking anyone to do my homework for me. I just feel that the real world example is most beneficial for my understanding. These are the two properties:

http://www.zillow.com/homedetails/1910-W-Sligh-Ave...

http://www.zillow.com/savedhomes/for_sale/45039750...

I have one main question about them, and it is: Why not buy this? Why would an investor look at these two properties and say, "Not a good deal." ?

They are turn-key, already contain renters paying a decent amount for rent, they have security deposits that would transfer to me, the "Zestimate" (however reliable that is) is far higher than asking, the Tampa, FL real estate market has projected growth over the next few years, the units look like they're in really good shape, and both units are at the same address. In danger of sounding obtuse, I'm still inclined to ask why anyone with this area in mind, and the proper capital, would not buy them. 

I understand that there is considerable risk in any investment, plus additional costs to worry about besides the mortgage, plus anything and everything that might break during the tenant's lease, plus the potential stress and hassle. In general, though, what should one be looking out for with deals like this? Perhaps it's just because I'm a novice, but this looks like a steal based on given info. 

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