too good to be true?? [Calc Review] Help me analyze this deal

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Bob Prisco
Specialist · Cleveland, OH · Member since 2018 · 1k+ posts · 666 votes
7y

@Nick Ruffini I am a bit spoiled. I avg 30% ++ NET caps paying cash for my props.  So please do not take my comment as its not a good deal, IT IS !! Just not for me, as again I am a bit spoiled 

Continued success to you 

2Reply
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  • Ernesto Gutierrez
    CA · Member since 2018 · 12 posts · 3 votes
    7y

    I'd buy it.

    2%: It's a bit under at (1.48%) so maybe you're paying a bit more for the property / current rents don't justify the asking price.

    50% Rule: 259/unit profit is pretty good.

    What's your hesitation?

    0Reply
  • Dennis M.
    Rental Property Investor · Erie, PA · Member since 2018 · 6k+ posts · 9k+ votes
    7y

    @Ernesto Gutierrez

    This is California ? I

    would do this especially if it’s in California

    0Reply
  • Will C.
    Rental Property Investor · Richmond, VA · Member since 2016 · 279 posts · 133 votes
    7y

    @Nick Ruffini

    on market since January, started at 175k now at 160k. building is over 100 yo. Rents seem to be accurate but I would have never guessed looking at the place. mattresses and junk in yard. Inside pics look ok but probably doesn't look like that anymore. River in back, flood zone?  hmmm, someone would have snatched this up by now I think. Im not in this market though.

    0Reply
  • Bob Prisco
    Specialist · Cleveland, OH · Member since 2018 · 1k+ posts · 666 votes
    7y

    @Nick Ruffini numbers seem ok  ( I would not touch it ) not great. Definitely not to good to be true. Net caps like this are to be had in the mid west 

    good luck 

    1Reply
  • Darius Ogloza
    Investor · Marin County California · Member since 2018 · 1k+ posts · 2k+ votes
    7y

    The questions I have:

    How solid is this neighborhood? (i.e. are the rents real or wishful thinking) What cross-checks have you done for this neighborhood's rents? 

    Leases? Month to month tenants? 

    Does NOI calculation seem right for the area (i.e. is $7,500 for taxes + insurance realistic? Who pays for utilities?)

    Repair costs/after repair value prepared by you or by seller? (i.e. real or BS?)

    Is the proposed non-owner financing achievable in this area?

    Do you have anything better to do with $25K at present or within the relatively near future?

    0Reply
  • Nick Ruffini
    OP
    Rental Property Investor · Los Angeles, CA · Member since 2018 · 77 posts · 22 votes
    7y

    @Bob Prisco I thought the numbers were pretty good considering it would cash flow $935/month with a 29% Cash on Cash ROI. Curious, Why would you not touch it? Any info is greatly appreciated.

    0Reply
  • Nick Ruffini
    OP
    Rental Property Investor · Los Angeles, CA · Member since 2018 · 77 posts · 22 votes
    7y

    @Darius Ogloza

    How solid is this neighborhood? (i.e. are the rents real or wishful thinking) What cross-checks have you done for this neighborhood's rents?

    >> Rents seemed high to so I want to confirm that's what the current tenants are paying. 

    Leases? Month to month tenants?

    >> Both are on a lease for now. 

    Does NOI calculation seem right for the area (i.e. is $7,500 for taxes + insurance realistic? Who pays for utilities?)

    >> Taxes seemed a little low - confirming taxes today. 

    Repair costs/after repair value prepared by you or by seller? (i.e. real or BS?)

    >> ARV is based on current selling price (The number in the report is what I would OFFER not what the selling price is)

    Is the proposed non-owner financing achievable in this area?

    >> I'm not exactly sure what you mean buy that?

    Do you have anything better to do with $25K at present or within the relatively near future?

    >> I have money set aside to purchase a rental property, so I'm constantly looking for one. 

    0Reply
  • Bob Prisco
    Specialist · Cleveland, OH · Member since 2018 · 1k+ posts · 666 votes
    7y

    @Nick Ruffini I am a bit spoiled. I avg 30% ++ NET caps paying cash for my props.  So please do not take my comment as its not a good deal, IT IS !! Just not for me, as again I am a bit spoiled 

    Continued success to you 

    2Reply
  • Nick Ruffini
    OP
    Rental Property Investor · Los Angeles, CA · Member since 2018 · 77 posts · 22 votes
    7y

    @Bob Prisco ahh, ok makes sense. I appreciate the feedback. 

    1Reply
  • Darius Ogloza
    Investor · Marin County California · Member since 2018 · 1k+ posts · 2k+ votes
    7y

    I meant to write "non-owner occupied" financing, which tends to be more expensive than the rates available to owner occupiers.    Sorry about any confusion.     

    0Reply
  • Bob Prisco
    Specialist · Cleveland, OH · Member since 2018 · 1k+ posts · 666 votes
    7y

    @Nick Ruffini you are very welcome, 

    all the best to you 

    0Reply
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