All Forum Posts by: Adam P

Nothing major happened on that property, just those numbers aren't great.  

HOA was $510 a month.

Mortgage/Insurance/Taxes payment was $1400 a month

Property was in fantastic condition, but there is always maintenance.  Whether HVAC unit, replacing a faucet, broken microwave, etc.  

$1950 a month won't sustain a $225k condo.  It is a bad investment.  I made $100k on the sale, so made out fine.  But you aren't cashflowing long term with those numbers.

This won't cashflow.  I bought a property at the bottom of the market for $225k that rented for $1950 a month.  I basically broke even for 5 years before selling it at a nice profit due to capital appreciation.  

I took the gamble in 2011, because I knew prices were at multi-year lows.  We are not at lows right now, if anything we are getting close to a peak.  

It is a terrible time to buy a break even cash flow property in the hope of appreciation.  

I have invested heavily in Pilsen in the last couple of years.  Great demographics, improving area, and it flies under the radar of the big money due to being southwest of downtown.  It is possible to gross 15-20% after purchase and rehab costs, but you have to buy on the day the property hits the market.  

I had to blow up a 1031 due to a lack of deals.  It came down to, do I overpay for a property by $40k, or eat the $30k in taxes.   Paying the taxes ended up the better option.  

Naturally a month after the exchange expired, I found a decent property I am closing on now.  

Inventory was really bad March - July.   Since last month I have seen a few more potential deals pop up.  I am in Chicago and looking at buy and hold opportunities, and it is a lot rougher than previous years.

I have a portfolio of 20 doors, mostly in Pilsen, but also a building in Rogers Park and West Ridge.  

I am looking to migrate my portfolio across to a property manager.  I am interested in hearing everyone's experiences with property management in those areas.  I know from my holdings in other cities, that most property managers are terrible.  However I found great PM's after perseverance.  

I am hoping to skip the learning experience cost of bad PM's this time.

If you are an out of state investor, stay away from Little Village.  It looks like a great area eventually, but I don't think out of state investor is a good fit for such specialized investing.  

I invest heavily in Pilsen, the numbers are great.  But once again, for an out of state investor I have the property under contract before you even see it on the market.  It is tough to get good value in the current market from afar (it is tough enough getting value locally).

I am looking at a property where the seller owns a 2 flat, along with the vacant lot next door.  He wants to sell both as a package.  The lot the building is on is a different pin to the lot next door

Is it possible to use conventional financing for 2 pins in a single loan?  I have used a single loan before to purchase a condo and parking space which were separate pins, but I am unsure on whether a vacant lot next door would have different rules.

I already have 6 financed properties, so this would be a 30% down investor conventional loan.  I am looking for what the Fannie Mae guidelines would be.

 Finance/IT.  Denver has a good base of finance firms, but doesn't pay national level salaries.  Historically people have moved to Denver for the lifestyle.  However now with house prices booming, either that will need to change, or home prices will have to more closely align with salaries.

 Honolulu and San Francisco have;

- Natural boundaries that Denver metropolitan area does not have.

- Higher population densities than Denver metropolitan area

- Higher proportion of NIMBY baby boomers blocking new construction

Denver is not San Francisco or Honolulu, and never will be.  It is a wonderful place to live, but the current boom is just population growth that was faster than construction speed.  Capitalism means eventually developers will come in and build enough housing to catch up, and prices will move to be more in line with incomes.  I get calls about once a week to move back to Denver, for a 60% pay cut.  The salaries just aren't there to support huge property valuations.

It is a great gain.  Do you think it is sustainable?  I bet no, at some point property prices will come into line with incomes.  Denver has so much land, no geographically significant boundaries.  There are some affordable housing ordinance taxes which have raised values in the short term, but longer term I think construction will catch up.    

Tough to pick the peak, but I think we are closer to the peak than the trough.