All Forum Posts by: Apoorva K.

Oh I missed this by a day! 

Podcast #211 is a huge motivation to do notes.

@Bob Malecki and @Wayne Snell , I am PMing you for help with learning resources. If you could please share, that would be great!

Thanks!

I am newbie to notes, looking around for my first steps, and I hit this thread. To the point and actionable steps! Couldn't have asked for more.

@Account Closed - thanks for starting this thread.

Right, 12K tax and 2K insurance are just rough numbers so we arrive at price and cap rate. They do vary a bit depending on everything (schools, neighborhood, proximity to water, size/location of property and so on), but 12+2=14K are good starting points to do numbers on small multis.

For cap rate,

Cap Rate = ((TI-TE)/PP)*100

Where TI = Total Income (yearly)

TE=Total Expenses (yearly)

PP=total Purchase Price including closing & financing costs

That's for rough numbers.

When I do detailed numbers, some parts are adjusted. For example, take realistic rents after stabilization, take out tax payment section from closing costs etc.

@Michael Poat - SBU is a good idea. What would be market value of that 3/2 converted to 5/2 house? Is there any (extra) town inspection for student/shared housing?

For 3800 rent, if I were to do back calculation, 12K tax, 2K insurance, 10%PM and 10K for closing - price should be around 330K to make it 8CAP. And that would be without any capex and vacancy considerations. If I add 8% of rent towards it, then 330K (+10K) would make it <7CAP.

7 CAP appears low, but that's very difficult to achieve - is what I saw.

@Rich Becker Yes, you are right on most of things you mentioned. Prices are high here on LI. 2% is a dream. I was looking for 1%, and even that is hard to get.

I guess if one looks harder, spends more time and efforts, one can find deal(s) here as well. Just that for me, overall scenario didn't make sense : prices are high, so too much capital invested in single property, and most of these houses are old. After 50 years, any house would need maintenance. So it's more than just a PM job.

I do sound negative here, but it doesn't mean it won't work here. There are many people here who are doing it successfully on Long Island - just like Kiyosaki said. May be they can chime in and advise both of us. 

@Account Closed I am under 10 loans, so I do enjoy enviable rates.

I had to extend contract twice for two straight forward cases in December with a national lender, so am trying a portfolio lender now. I will PM.

@Andrew Pence, 

Welcome to BP. I am an investor, have a few properties in Columbus - south-west. 

I am pretty happy with my contacts there, but I see that getting good deals is getting harder and harder by month. And for last year or so, there's barely anything good for a remote investor.

Wish you best luck with flips and do let us know how it goes.

Best,

Apoorva.

No - I don't have any locally. I researched queens last year, and quickly dropped it because of NYC laws and that market is too hot there.

Then worked on Nassau and mostly Suffolk (west & central Suffolk). What I found was that numbers are little better in Suffolk. But it's still quite low IMHO. Even if we don't include much on capex, vacancy and PM, it was generally hard to go beyond 6 CAP. When one is making larger investment here, I didn't like those numbers. Specially I don't want to manage properties - so if I add PM, numbers just didn't make sense.

That demotivated me. And I started looking elsewhere.

OTOH, vacancy is very little anywhere on the island. So that's a plus. And that rents have increased quite a bit in last 2 years or so.

If you are looking in Suffolk, do LMK. Will be more than happy to share what I saw.

Good Luck!