I did it. I really really did it! Small Multi-Unit!
10 units on 4 lots. $176,000. ARV $294,000.
10% down, Seller financing for one year at 5%. My bank informally approved the deal so not over concerned about converting to conventional
Anticipate 10K in immediate capital expense to upgrade one vacant unit and put a roof on a large duplex.
Rents $5000 mo, easy, low-hanging-fruit potential $6000.00 mo. Long-term (1-3 years) maybe as much as $8000.00.
Current vacancy is 30%, rental units are in high demand. One unit will be out of circulation for approx 30 days for upgrades/repairs. Three bay shop as bonus property.
I was looking for one more SFH when this opportunity knocked on my door. Giddy and a-skeered all at the same time.
Comments (20)
This is a one year seller financed note, the payment is about $1250, amortized over 15 years. In the next 3-6 months I will convert to a conventional bank note which will cost 6% but will maintain the original amortization. If the appraisal allows, and it probably will, I may cash out about 10K to start an emergency fund. I don't fool with the 2% or 50% too much, I prefer to analyze each deal individually. I will be posting my monthly results during this turnaround period so you can follow if you wish. The numbers will be real, not a textbook fantasy.
Deborah Burian, over 11 years ago
Wow! Awesome deal! Congratulations on it. You should post some updates on the progress of the repairs and stabilization of the properties. Will love to hear about you getting your $8000! :)
Shaun Reilly, over 11 years ago
I will happily post updates. Right now just trying to get my feet under me and be certain everything is working.
Deborah Burian, over 11 years ago
Hi Deborah, I know this is an older post. Awesome purchase. I'm curious what your monthly payment is on $158,400 at 5%? For how many years is the loan? What is your monthly cashflow at 50% of $5,000? Thanks!
Michael Dorovich, over 11 years ago
Congrats!
Dawn Anastasi, over 11 years ago
@Deborah B. - Congrats!!! I am very excited for you!
Paul Grgurich, over 11 years ago
Deborah B., Congratulations! This was a great post to read, love how you tied it back to what we've seen posted here on BP. Very similar to how I got the property I'm working on rehabbing now as far as shooting for the moon with the terms - I still can't believe they were accepted and it's been 10 months! Congrats again and enjoy!
Kristopher K., over 11 years ago
So many questions... so little time :-). Plus a very slight hangover from the celebration dinner last night. Justin C., Matt Devincenzo, is exactly right. I shot for the moon on terms and the owner agreed. She is a precious older lady with a very troublesome PM, it was worth it to her to just be done with it and let me solve the problems. How many times have you read that from Bigger Pockets Posters. David Allen and Kevin H. There was no search. I wasn't even contemplating a multi. (you've read this on Bigger Pockets too) a mutual friend knew I was an investor and suggested I call. This was all about reputation and responding to people. Even though I wasn't interested, I owed everyone a response. Then I got excited and started learning as fast as I could and decided it made a lot of sense for us. Among other things, it hit a sweet spot geographically. Al Williamson - I just want you to know it was your post about changing neighborhoods that got me going on this property. I owe you in a big way! Ned Carey, those are some pretty big shoes to fill! You'd better stick with Brandon. Thanks to all for the wonderful responses.
Deborah Burian, over 11 years ago
Congrats!
Joshua Dorkin, over 11 years ago
Deborah B. Good job!
Brandon Garcia, over 11 years ago
Deborah B. I'm doing the funky chicken with you! Way to go!!!
Al Williamson, over 11 years ago
Excellent! Opportunity knocks because you are out there looking. What is your search strategy?
David Allen, over 11 years ago
Congratulations! That's a fantastic size asset to enter into multifamily.. Well done!
Rick Corbin, over 11 years ago
Wow that sounds like a killer deal just on the price alone but it looks like you got pretty good terms too. Congratulations. I guess I am no longer impressed with Brandon Turner's deal. You are my hero now.
Ned Carey, over 11 years ago
It's okay Brandon Turner you are still the Wind Beneath My Wings.
Shaun Reilly, over 11 years ago
Hahaha Ned Carey! I want to be your hero!
Brandon Turner, over 11 years ago
Hahaha Thanks Shaun Reilly!
Brandon Turner, over 11 years ago
That sounds great! How did you find the multifamily property if you don't mind me asking?
Kevin H., over 11 years ago
Looks awesome. Where did you find this deal? How were you able to get away with a 10% down payment, as I thought that without an FHA loan for an owner-occupant, 20-25% was the standard minimum.
Justin C., over 11 years ago
Justin she got owner financing, there the only criteria is what you can convince the owner to take. :)
Matt Devincenzo, over 11 years ago