All Forum Posts by: Arionna Barajas

Ok, so I've run this through Brandon's rental analysis a couple times and this is what I've come up with. 

Income 3600

Expenses

Taxes 546 (Lender) 

Insurance 115 (Given to me by lender in estimated closing costs) 

Utilities paid by tenant

HOA None

Vacancy 180

CAP ex 200

Property Mgmt 360

Mortgage 1921

Total Expenses 3122

Cash Flow 3600-3122 = 478

478 x 12 = 5736 Annual 

Cash on Cash ROI

Downpayment 0 (VA loan)

closing costs 11,378

Total investment 11,378

5736/11378= 50% cash on cash ROI

Am I wrong here? Is this still a bad deal? 

Obviously, the first year we have to live here because it's a VA loan so we would actually be paying out of pocket and losing $ but when we are able to move out, those are the numbers. What do you think?

Thank you everyone! 

@Audrey Ezeh, awesome info! Thank you so much! I will be looking up a PM in Clarksville! 

@Lesley Resnick, you think so? Yes, I can get up to a quadplex on my VA loan with 0 down. I am approved for up to $423,000 and the one I'm looking at is $400,000.

I'm just trying to figure if it's a good deal in and of itself without letting my loan info sway my decision. Would you factor the loan into the decision then? 

Thanks for all your time! I appreciate getting advice from all of you more experienced than I. 

@Ron Dayley

I would love to look at anything you have to send me. Thank you! 

Thank you, @Audrey Ezeh! Didn't think about that! 

Is there a reliable way to check vacancy rates? I'm sorry, I don't know enough about this yet to know where to look! 

Hello everyone, 

I am semi-considering buying a fourplex in Clarksville, TN for $400,000 with my VA benefit and living in one of the units while managing this property with my husband.

The rents are currently at $895/mo for units built in 2012/ 3br/2ba each. 

The MLS reports says the gross income was $20,585. Not sure why that was so low? Maybe all units were not rented out? Expenses were $2008 and NOI was $18,577.

I have been reading 'The Ultimate Beginner's Guide to Real Estate' and 'The ABC's of Real Estate Investing' and it seems that with those numbers that would only be about a 4% cap rate which is not good at all. Am I correct in that? 

Common sense tells me that the rent should be a little bit higher in these apartments which are close to a big army post where even the lowest ranking soldiers make about $1100/mo for housing allowance. Why would I not be able to charge more rent, fill all the units and bring the net income up? 

Obviously, I am very new at this so this may be a big leap. My other option is to use my VA to buy a much cheaper home and then use a conventional loan to start buying cheaper investment properties.

@David Faulkner, wow! Thank you so much for the detailed advice! I have been learning to manage personal finance during the last few years and feel like I have a somewhat decent handle on it. 

As far as cash reserves go, I only have about $20,000 cash saved up and about $90,000 equity on my house that has been renting out for the past four years. I have $137,000 in debt on that house so maybe I'm not exactly sure how that puts me in terms of having a good handle on personal finance. Other than that, I have no debt. 

I am so new at this. Grateful for all your advice. 

Oh my gosh! @Linda S., that sounds so fantastic. There is a four unit multifamily here that I am tempted with. I am just so unsure at this point of how to make a 'good deal' and when is too much risk? It already has multiple tenants in it. Your post got me excited. Lol. Thank you. 

@Dan Krupa, do you still have the four plex? Renting it out? I have seen one here for $147,500 in which three are rented out and the fourth is kinda crappy but not horrible. I'm interested. 

Thank you, @Bill S. That does sound reasonable. My teenagers prb could use some stability after traveling all over the world for the past three years.