All Forum Posts by: Andrew Dillard

Thanks @Edward. They were not provided by anybody. I used them as an assumption (3% of the monthly rent for each CapEx and Repairs)

The area isn't that rough and is currently going through gentrification. 

What percentages would you typically expect to realize?

I am looking at purchasing a multi family deal in my local market. 

Deal Stats:

Price (Current List): $109,900

2 Separate duplex properties on the same lot for a total of 4 units.

7 bedrooms 5 bathrooms

All units recently renovated

Income

Gross Monthly Rent: $2,400

Expenses:

Mortgage: $500

CapEx: 3%/mo = $72

Repairs: 3%/mo = $72

Insurance: $150/mo

Property Taxes: $130/mo

All utilities are the responsibilities of the tenants

I will be managing the property myself

Total expenses/month = $924

Based on the BP Rental Tool I get the following results:

Pro Forma Cap Rate: 21.12%

Cash on Cash ROI: 222.05%

Income-Expense Ratio (2% Rule): 2.14%

Debt Coverage Ratio: 3.97

Monthly Cashflow: $1,479.39

NOI: $23,734

The Market:

Where this house is located, 44% of the market is renting vs 33% for the state

The most popular type of rental is 2 bedrooms, which are 3 of the 4 units in this deal.

Median Rent is slightly less than the current rent on these units.  How much of an issue is this?  All units were recently renovated and are in great shape.

What am I missing?  This deal seems like its too good to be true compared to some of the other deals I've analyzed.  No updates needed, 4 units for ~$100,000.  Any thoughts if this is too good to be true or is it really a good deal?

How essential is it to have your own RE license if you are thinking of becoming a buy and hold investor?  Any drawbacks or specific advantages?

Hey all. I am looking to get into REI and I am looking to make some connections in the KC area. I'd love to be able to pick the brains of some more seasoned investors. I know there is no such thing as a free lunch, so in return I am prepared to offer you some of the best beer you can't buy here in exchange for your time and thoughts!

@David Roque I have the same concerns.  It was noted that one renter will be vacating on 3/31, which is poor timing, but could allow for me to make some updates to the vacant unit and increase the rent.  The previous owner updated the furnaces, roof and exterior siding a few years ago.  I would add in an inspection contingency.

Hey @Gino Barbaro Thanks for the response. I just ran this through the BP calculator and I changed around some of the numbers (including expenses) thanks for the tip @Hank A.

Monthly Income = $1,300

Monthly Expenses = $770.25

Vacancy - 5% = $65/month

Insurance = $75/month

P&I = $377.92

CapEx = $65.00

Property Management = 5% - $65

Property Taxes = $122.33

OK Area means the area surrounding it gets a bad rap/economically depressed, but the street and neighborhood where the property is located is fairly secluded and off any main roads or public transportation routes.

Hey all.  I am thinking about buying my first property and I wanted to know what you all think.  I am going at this solo, without a mentor or partner, so I wanted to get some unbiased opinions.

Property type: 2 unit duplex

List Price = $87,000 

Downpayment = $4,000

Repairs = N/A

Rent per unit = $650

Monthly Income = $1,300

Monthly expenses = $250

Estimated Mortgage cost = $400

Monthly costs with mortgage = $650

Yearly Cashflow = $9,175

CoC Return = 229.39%

Building is in good shape, newer roof, new HVAC on one side.  Could use some updating but it's not a deal breaker for rent yet.

Anything I am missing or not thinking about? What are you thoughts? The property is in an OK area. Fairly secluded but definitely a more economically impoverished area. It hasn't been listed long on the MLS so it could move quickly.

Hey all!  Hope I'm not too late to the party, but I'd love to meet up with you all for some beer!

Hello!  I am an interested owner/investor looking to sink my teeth into the real estate market!  I am a life long entrepreneur and I am looking to broaden my reach into more traditional markets!