All Forum Posts by: Adam Bradley

For more context, this was a response to direct mail marketing. The seller is out of state.

I did say that I could definitely get rent of $425, however I am being conservative. Literally, 100' away is a 10-year-old 100+ unit complex of 2/1's that rent for $585/mo and are booked full a year out (I called and asked questions like an interested renter.

Steve Vaughan, I'm a noobie but I think I understand "a turd and a haircut" to mean "not much money". Right?

Also, forgive me but what does LL stand for?

Thanks for all of the input folks!

Cody and Steve, great input, thank you very much!

Steve, forgive me, but does "low rental point" refer to the monthly rent of $425? If so, then I think you mean that "the type of folks who will only pay $425/mo for rent will likely damage your property". If this is what you mean then at what rental point does this danger, in your experience, disappear?

If that is not what you mean by "low rental point" then please elaborate.

Thanks for the great input.

I'm in a situation where I'm not sure if the area makes it a "not at any price" deal. I know that you need more info to say "I'd do it" but my question is: are certain areas a hard "no" for you ... at ANY price?

Details:

Fiveplex - all 2/1

currently completely vacant

built in 1965

in a D area (currently bars over non-broken windows, others gone completely with just plywood)

I can buy for $20,000

needs $30k repairs/upgrades

can definitely immediately rent out, after repairs/updates, at $425/mo per unit

would be managed by local property mgmt co

Would the "D" area make this, or any deal, a hard no for you?

Thanks a lot for your input.

Patrick, how much extra is lawn maintenance per month?

Thanks a lot!

Newbie here. If I own a 10 unit apartment complex and it is managed by a local property management company; normally, whose responsibility is it to cut the grass?

Is lawncare/landscaping usually included in a PM's 10% fee or would the owner have to find someone to maintain the yard outside of the PM?

Thanks for your input!

Someone has also posted one here on BP.

https://www.biggerpockets.com/files/user/Hunter-SA/file/letter-of-intent-to-purchase-real-estate

This sample is available with a search. How close it is to what folks actually use? I don't know.

Letter of Intent to Purchase Real Estate

Dear Sir/Ma’am,
It is the intention of the parties [Name of Seller] (Seller) transfer to [Name of Buyer] (Buyer) all of the Seller’s right, title, and interest in and to the following real estate (the “Property”):

Terms & Conditions

Property Address:

Purchase Price:

Deposit Amount:

Down Payment (including Deposit):

Amount and Type of Loan:

Escrow Closing Date:

Agent’s Address & Phone No:

Acting For (choose one): ___ Seller exclusively ___ both Seller and Buyer

Buyer’s Agent:

Agent’s Address & Phone No:

Additional Terms and Conditions:

Activing For (choose one): ___ Seller exclusively ___ both Seller and Buyer

The transaction described herein is contingent upon the Buyer obtaining a mortgage loan as described above.

Ben, wow. That is an amazing amount of helpful input. THANK YOU!

Also, thank you for correcting my too-low percentages for maintenance and the like. I'll use 10% going forward.

Fiveplex built in 1986

All 5 unites occupied

4 X 4br, 1ba @ $525/mo

1 X 1br, 1ba @ $485/mo

http://www.realtor.com/realestateandhomes-detail/5...

Seller is asking $185,000

Market value per county is $152,900

All units don't necessarily need fixing but could sure use updating. This has been estimated to be $20,000 for the entire property.

My strategy is to buy and hold multifamily properties for long-term income (shooting for $150+ per unit cashflow). I am new to REI so I've got some easy questions for you.

The property is already fully occupied. To renovate, do you normally kick everyone out and then offer them first dibs to move back in at higher rent?

To employ the BRRRR method, if I did not kick everyone out, then I assume that I would need to just get the property well below value so that I could get all of my equity back out via refinance to "Repeat". How would I estimate market value --- I've read that sometimes this can be estimated by using the NOI.

Also, is cap rate important or not? I've read here that you can ignore cap rate and focus on cashflow.

Here are all of the monthly numbers that I have on the property:

Total Income 2,585.00

Tax $77

Insurance ? (How can I calculate this?)

Utils are paid by tenants.

Lawncare $40

Vacancy 5% of total income

Repairs 5% of total income

CapEx 5% of total income

Property Mgmt $325

For my understanding, how would you run the numbers on this property? (I've used the BP BRRRR calc but I'm screwing something up because even when buying at $100,000 with $25,000 for rehab, the short-term loan ends up with monthly payments over $8k.

How would YOU run the numbers and decide on an offer price that would make it cashflow $150/mo?

Thanks a lot for your input. I look forward to not being a newbie and asking stupid questions.

Scratch that, I'll be wearing a white button up shirt and khakis.