All Forum Posts by: Abdul R.

Just stumbled on this, lee smith and his company are fantastic! I have been with them for a few years. 

So professional and everything is very transparent. 

@Account Closed

I looked at the blog. I Didn't see hard numbers in regards to cash flow or return on invesments. Can you explain what type of numbers you are getting or what I can expect?

OK so update time:

I ended buying 6 properties in Indianpolis.  2 SF, and 4 duplexes in C and C plus area's  via financing. Started April 2016 and bought last property in Dec 2016.  Spent about 143k total after doing some moderate rehab. Cash flowing about 2,700  monthly after accounting 20% for repairs and vacancy. 

Positives: Cash flow! See above. I think I did pretty well. I am nearly at  about 23% cash on cash return. Need to buy more, but stopped as of Dec 2016 as I actually took the plunge and bought a home in bay area due to fear of being priced out. These double digit year on year price increases will do that, and I refused to do a long commute. So now slowly starting to build a reserve again. 

Lessons learned:  My realtor didn't give me a good indication of how much rehab costed when I purchased, so it took about a year and half to start making money. Essentially I used my own cash and most of the rent money to pay the reno costs.  

Also communication and being patient to find a tenant is also key. Better to wait a few weeks longer or a month to find a good tenant, or even lower the price as I had 2 tenants that were very difficult and caused issues.  

Turnover costs have been minimal so far.  I had two, costed just a few hundred dollars and rented within a month. 

Hope this helps!

 Thanks Lee!  Never knew about this.  I'll definitely use this as a tool moving forward. 

@Matthew Schroeder

Correct. Those are the properties and it is not a turnkey.  They have been on the market for a long time due to having a laundry load of items to fix (e.g. new roofs, mold, some electrical issues ect). The owner was able to get insurance to pay for nearly everything just recently and this is on purchase agreement. So he agreed to pay for all repairs, and renovate and fix up the empty unit that needed a new carpet, paint and cabinets. One of the properties has been vacant because he has been using it for realtors to check out (it is renovated), as all the units look the same. The other side just got a vacancy. 

Indeed pro-forma cash vs actual are very different indeed!  Issue is the guy managing the properties has no detailed rent payrolls or maintenance but has documentation on the active leases (with deposits) however.   So essentially, it is a risk, but trying to minimize it as much as possible by having everything repaired, and getting a good grasp on tenant population there. I called a PM company and said they would ask research the area more tomorrow to get more details. 

 Looks like a mix of 50k and 60k.   I was hoping I could get a better idea from someone that knows that specific  area. 

 Thanks for the advice Mathew. I used google earth. Looks like a decent area. Trulia crime report shows "Lowest" with regards to crime activity. 

What more specifics are needed? I gave purchase price, current rent,  mentioned no repairs being needed, and utilities are paid by tenants. If I can just get "decent" tenants (pending advice the area is decent) I believe it a screaming buy in regards to cash flow; as I can get about 25% cash on cash return. 

I have a property in mind:  on  Homeridge Dr Indianapolis and another property on that same street. 

Anyone know this specific area? How is it? I am purchasing a package of 2 duplexes for 63k (each was initially 74k) with new roofs, and all repairs to be done. One of the duplexes (2 bedroom, over 900sqft, ) rents 600 and the other 525. Each side has one vacancy. Thoughts? I been managing my other Indy property out here  in Cali, and so far so good so may do the same with this. 

Input would be greatly appreciated, as i mostly invest in nice areas (perry township, wayne and 54th street and above), so this would be quite different, as seeing from the school ratings. Just don't want a war-zone type area. 

Sorry for the late response (i am not getting notifications from this thread, going to fix this).

Thank you everyone for your input.  I guess ill see if he decides to go into litigation, maybe he wont even respond because its only 1k. If he does, ill reach out and ask to split the EM.

 Interesting.  Even though it explicitly stated that information was required? It was under the additional conditions.  That was the reason it took longer to make a decision,  I didn't have all the numbers