All Forum Posts by: Amaf J.

Evening everyone,

I've been searching recently for a MFH property with at least 4 units. I found one while browsing the net. I contacted the realtor and he provided me with some details and a financial breakdown. Property has been fully occupied with long term tenants. Said the roof was replaced four (4) years ago and the interior of the units are in okay condition. I did my own analysis based on my own numbers to see if this would fit my criteria. I plan on using a FHA loan to purchase my first rental property and I'll occupy one of the units myself.

1) Gross income (yearly) - $49,380

2) Vacancy rate of 6% - $2,963

3) Income - Vacancy = $46,417

4) Expenses (yearly) = $18,234.24

    Taxes = $6,962

    Insurance = $1,600

    Water = $1,350

    Sewer = $2,672

    Maintenance = $2,071

    Gas = $1,500

    Electric = $500

    Replacement Reserve = $1,200

    Advertising Fee (1%) = $414.54

5) Net Operating Income = $28,183

6) Debt Service = $19,761

    Assuming 3.5% down-payment, on $295,000 home value, 5% interest on a 30-year loan

7) CFBT = $8,421.28

I don't know if I did the the analysis correctly on this but any feedback would be helpful. So what do you guys think about the deal?

@Raymond B., thank you for the help, I was trying to figure out how that worked!

@Anthony G., that's a great success story. I'm looking for a similar setup but the houses I've analyzed have been way too expensive to pull that off.

@David Krulac, the 5% down payment is  for a conventional loan?

@Che Chiu Wong, I've been looking in Passaic, Bergen, Essex and Morris County. Do you happen to have any suggestions where to look?

@Sean Ploskina, know of any ways I can find deals like these? Good to do out-of-state investments?

@Swat Khan, I'm trying my best to do as correct of an analysis as possible. Would hate to get into something that will cost me long-term and isn't a sound investment. 

@Matt Slakey, I've saved up a decent amount so far. I was planning on using the FHA loan at 3.5% to purchase the first property, then using the rest of the funds I have to go towards the purchase of a second property. What do you think?

Hello,

I've been looking at multi-family properties, mostly four-plex, to see if I can find a potential property to purchase. I did research on how to analyze properties to see if the deal makes sense or not. The kicker is that I can't find a property using a down-payment of 3.5% with a FHA loan w/o having to pay out of pocket? Is this normal or not?

Can the gross rent roll ever cover the expenses w/ mortgage payments at a 3.5% down-payment? Based on my math it's hard to find that realistic. 

@Gino DelGais, thanks again for all the information. I did not know the FHA was limited to just four (4) units. I'll start to limit my search to 2-4 units then. When checking comps, do I search using zillow and property shark? Also, how do I look up the average rent in specific areas? When verifying that information, do I call the local city office and property management companies?

@Ellis San Jose, thanks for the heads up. As long as the building is somewhat occupied, I shouldn't have any issues with financing?

@David, I've read the following books:

1) The Millionaire Real Estate Investor

2) Buy It, Rent It, Profit!: Make Money as a Landlord in ANY Real Estate Market

3) The Book on Investing In Real Estate with No (and Low) Money Down

Good afternoon everyone,

I'm new to both real estate and to this forum. I've done a fair amount of researching which included reading books and viewing some investment videos. I want to hit the ground running so I did some research on potential opportunities.

I found a local property that's 8 units, newly renovated, brick building and it's completely vacant. Asking for the property is $550,000 and I plan on using a FHA loan to purchase the property. Property is located in an urban area (East Orange, NJ) with the possibility of section 8 being offered. They're stating based on their analysis that it's a 13.53% cap rate.

- 5 rooms, 3 bed, 1 bath per unit with 8 units

- Saying the market rate for each unit is $1,200 or section 8 is $1,632 

Here is a copy of the analysis that was sent to me:

Link to analysis

(If it's too small then I'll put it into an excel file)

What do you guys think about this deal?

Thank you all.

Hello everyone,

I'm new to real estate and have read a few books on the subject. After reading the books, I realized this would be the best way to increase my net worth in the shortest period of time compared to other methods. I'm looking to do multi-units, buying and holding the property as long as it's bringing in a positive cash-flow. I'm currently working full-time for a telecom company but would like to slowly transition over to real estate as a full-time gig once I've mastered most of the concepts.

Also, I'm located in the Northern New Jersey area and would appreciate any feedback from a seasoned investor.

Thank you all!