First Purchase, Alaska 4-Plex

[Sean Davis]

Greetings Compatriots!

This is my first post, my first purchase, my first foray into real estate investing.

AND I AM TERRIFIED EXCITED!!!

I would love to hear any input from the sages here and become an active member of the community. My goals with investing are to create a 6 figure cash flow after all expenses (including mortgage, insurance, vacancy, etc).

I live in a remote village in the Bush of Alaska. I do not know if I will be here long term and there are numerous complexities in attempting to acquire and maintain property here, so I've decided to invest remotely. Because of this, I feel that I need to utilize a property manager.

I am purchasing a 4-plex in Anchorage, Alaska. I would rate the neighborhood as C, it reminds me of the places that I lived in college. The list price was $350,000 we negotiated down to $330,000 (This should satisfy the 1% rule, I am still trying to get a good enough feel for the numbers to not utilize this as a crutch). There is some CapEx that I'll need to put in come Summer, but nothing structural or safety related. The inspector said, "I would buy this property."

I utilized a spreadsheet from Roofstock to help organize the numbers. I am hoping that I’m being sufficiently conservative, but I am hoping that I can realize more cash flow than this for such a substantial outlay of cash.

Income	Month	Annual	Assumption
	Rent	$3,450.00	$41,400
	Vacancy Factor	$172.50	$2,070	5.0%
	Expected Rent	$3,277.50	$39,330
Expenses		Month	Annual	% effective rent
	Prop Taxes	$385.00	$4,620	11.7% (Actual)
	PM Fees	$262.20	$3,146	8.0% (Calculated)
	Leasing Fee	$81.94	$983	2.5% (Calculated)
	Prop Insurance	$222.83	$2,674	11.7% (Actual)
	Repairs & Maint	$180.26	$2,163	5.5% (Calculated)
	Cap Ex Reserve	$172.50	$2,070	5.0% (Calculated)
	Utilities (Avg)	$600.00	$7,200.00	18.31% (Actual)
	Total	$1,904.73	$22,857	62.75%
Reserves		Month	Annual	Assumption (% effective rent)
	Turnover Reserves	$213.04	$2,556	6.5%
Debt Servicing		Month	Annual
	Mortgage	$1,070.43	$12,845
Cash Flow		Month	Annual
	Unlevered CF	$1,159.73	$13,917	Income - Expenses
	Levered CF	$89.30	$1,072	Income - Expenses - Debt Servicing
Net Operating Income		Month	Annual
		$1,372.77	$16,473

I’d love to hear your thoughts and I am hoping to improve my ability to analyze and execute on increasingly profitable deals.

Thank you for reading!