All Forum Posts by: Alex R.

Tevis

I am sorry to disappoint you but you are the fool if you think you can make 50k out of my deals.

That’s the reason I am doing my research before putting any offer and do my due diligence. No way I make an offer at full price or anywhere near that. It seems like all that stress, hair loss, and sleepless nights have taken a toll on you and clouded your vision.

Thank you for your reply Sam.

C-1 is the neighborhood commercial zone. The purpose of this zone is to provide an adequate variation of retail establishments and services that conveniently serve the needs of residents in the immediate neighborhood. It is highly desirable to blend uses into the area thereby protecting the residential character of the area; but not create architectural or traffic conflicts nor permit the commercial development to expand into a regional center of such scope and variety as to attract significant volumes of traffic from outside the neighborhood.

Even though I can think of innovative ways to increase the rent and current job market in Bakersfield with plenty of jobs in Oil and gas and agriculture section make this increased rent very doable, but I see that as wishful thinking and when making an offer, I want to be as realistic as possible and I will not hope for any income above fair market value.

I have a feeling that most challenging part in real estate is finding the right property at the right price. Once this part is figured out, every other task seems minor comparatively.

So here is the dilemma:
If your offer is low, it won’t go through.
If it as high, it won’t make you any profit or net income

great deal !!!!!

So what was your earlier post all about ?

---------------------------------

Income: 2560 (512 per unit)
Divide by 2: 1280

You are financing a MF property, 5+ units = commercial lending. Unless i'm wrong and some banks are now lending 1-4 loans on 5+ unit properties.

So most likely you will be looking at 25-30% minimum down payment, as most lenders will also take into account you have no history with RE, so they'll want you to have more skin in the game.

So going by that number: 230k Purchase price
69k down, lets say 70k down for ease of numbers, then say another 5k for closing costs, so approximately 75k out of your pocket in cash.

Now a 160k Loan, at 6% for 20yrs (These are just estimates mind you): you are looking at 1146.29 monthly debt service.

So back to the 50% rule: 1280 monthly - 1146.29 = 133.71 or crap

Either you missed my point or I am not getting your sarcasm.

Are you saying that even at 128k, this is still not a good deal?

I think as an investor, one should make an offer that makes sense and looks profitable regardless of how close or how distant it may be from the seller asking price.

If accepted good, if not move on to the next deal

at the right price every deal can be a grrrrrreat deal.

but now I see that at asking price, this has a big potential to fail.

at 128 K this will pass the 2% rent criteria but that is a far cry from the asking price of 225k.

what are the odds of this offer being accepted ?

Your portfolio doesn’t necessarily prove this.

You are welcome George :)