All Forum Posts by: Allen S.

@Paul Welden - We are looking forward to your July visit to Alaska too!!   And I'm sure the Salmon can't wait for you to arrive either...

@Daniel Fang - You're asking a lot of the right questions, and more importantly, you're asking them BEFORE you've decided to fall in love with this property.

In response to your specific questions:
- Find a local bank or credit union and go talk to one of their commercial loan officers.   "Local" branches of Wells Fargo and Bank of America do not count.  Find the "First National Bank of Your City".
- You should absolutely put a property like this in an LLC (my opinion, others may differ)
- You should talk to your CPA about tax write offs with this property.   You can do a cost segregation study and accelerate the depreciation, but if you're not a "Real Estate Professional" as specifically defined by the IRS then it may not result in the deductions you're looking for.
- The benefit of house-hacking is to have access to lower rates and lower down payments of certain residential loan products.   You won't be eligible for these at 5+ units.  

The others who have responded all have good points.   If it is at auction then it is distressed in some way.   The bank is not likely to sell it under market value if they don't have to, so if it is a steep discount there is likely something else going on (extensive repairs, etc).   This is not necessarily a problem, you just need to have a plan for that.  The market for everything is hot right now, so even if it looks like a good deal, it's probably still over priced.

At the size and price point you're looking at, and if you are planning on putting 50% down you are in a financial position where you don't need a partner.   You can take this down by yourself.  If you really want to have the comfort of a partner with more experience than you in this deal, then that's ok.   Just realize that splitting your equity is the most expensive way to find an acquire that expertise.  If this were a multi million dollar complex and had hundreds of units, then the bank would probably require someone on your team to have experience operating this type of asset.   A 6-plex is really just a 4-plex and a half with different lending rules and maybe a few different code requirements.   Definitely something you can learn to handle.

Good luck!

@Roberto Medina - will you be paying pre-payment penalties to cash out your retirement account?   If so, I would tend to side with your mom on this one.    In general I would say that having some exposure to the stock market is smart, and that your income is strong enough to not have to sacrifice that part of your portfolio to invest in real estate.

With reference to the real estate part of your question: If you actually hit your numbers, you're looking at a 17% return on your investment... 
$2800 x 12 = $33,600 NOI (Net Operating Income)
$33,600 / $200,000 = 16.8% ROI

In Anchorage you can't find a $200k 4-plex, and if you want to cash flow $2800 a month you'll have to own it outright, or have very little debt on the property.   If you're in rural Alaska I am certain your purchase and rent numbers will be much different, so maybe it is possible where you are.

@Jamie Rose @Tyler Bobo @Kevin C.

@Mark Askew - That ought to get you a good start.  There aren’t many wholesalers up here, but I’ve seen a few new guys around so they might have something going by now...

@Lucas Wacker - Have you tried a local bank or credit union and their commercial loan department?  I think you'll find they will be much easier to work with than rocket mortgage or any of the bulk online loan originators.  Commercial bankers are also much more accustomed to using the income from the property you are purchasing as a part of the initial underwriting. 

@Julien Okey Anchorage and Fairbanks are different markets, not better or worse, just different. I think as a new investor you will benefit most from the local meetups and starting to look locally. Unless you're planning to start out with NNN or will be in Anchorage regularly it will be more practical to start out looking for your first investment in Fairbanks.

Welcome @Julien Okey!   There's a good meetup in Fairbanks that would be a good place for you to get started while you're there.   It's led by @Tim Illguth.  Many knowledgeable people and a few other military members involved.  I would not suggest starting out by investing in Anchorage while you're living in Fairbanks unless you travel back and forth regularly.   If you PM me I'll add you to the signal chat for the group.

@Jonathan Baird

I'll recommend Stewart Title in Anchorage. We've also used Alyeska Title and Yukon Title for other purchases...

For legal we use Birch Horten Bittner & Cherot.  Not cheap, but well worth the expense.

Good luck!

@Landon Fillmore - there are plenty on this forum who have done STRs in Anchorage, but I am not one of them, so I can't speak firsthand on that topic.  Are you going to be deploying at all?  Being gone for a long time will probably influence your decision on that method of investing...  maybe @Eric Giovannucci can chime in on this one?

@Landon Fillmore - Wasilla and Palmer are definitely within a normal commute distance to JBER and both are quite popular.    I would say that 50% of military families live in Eagle River/Chugiak, 25% in Anchorage itself, and the remaining 25% in Palmer/Wasilla...  Depending on where you are in the Valley, the drive to base is 45 min - 1 hour.   Obviously you can choose to live farther out.   We have property right off of Trunk road and it's 35-40 min to the Fort Rich gate (no traffic), which means at least an hour at normal drive times.   With bad weather all bets are off.    There are tradeoffs between how much of your life you want to spend in a car every week and how much house/property/etc you'll get for your money.