Deal/Success Story in Process: Cash Flow in the SF Bay Area

[J. Martin]

Just under a month ago, I closed on a 4plex in (East) Oakland, CA in the San Francisco Bay Area. It was a HomePath property that had been on the market for just over 6 months, and was able to squeeze in with a conventional loan at a purchase price of $390K w/ a $5k seller's credit, or $385K. 3 vacant units, and other parts of the structure need about $45K in rehab/improvements, for a total cost of about $430K, to achieve my target rents of $5,100/mo, or about $60K/yr.

Purchase: $385K
Rehab: $45K
Total Cost: $430K
Target Rents: $5,100/mo; $60K/yr
Est GRM: 7
Est Cap Rate: 8-9% (8.5% @ 40% exp. ratio - all utilities metered & paid by tenants)
Est Cash Flow: 10-13% (leveraged, w/ 25% down)
Built-in Equity: $50-100K?
My share: 50%, w/ passive partner.

I haven't finished yet, so maybe early to post on the success stories forum, but I've had a lot of requests to put this information up, from people who came out to my 4plex for a meetup, and many others on BP who could not.. Getting into contract on this property and closing, was a success in itself, in my book, so I posted it anyway! Will be updating more as I get time!

Feel free to ask questions, yell at me for being insane for investing in *gasp* East Oakland, suggestions & constructive criticism, kudos/votes, or whatever else you'd like to throw my way :)

PS. I heard there is no cash flow in California! Or Bay Area..! Or Oakland..! :)