All Forum Posts by: Paulina Purnama

Hi guys, sorry If this has already been covered. I searched but did not get much info. 

We are in contract on a duplex in east nashville and are looking for a very good and through home inspector. 

Any personal recommendations?

Thanks!

@Dan Sifuentes

Thanks Dan! I will contact grandcanyonproperties and see if they do residential management. 

I appreciate the input

Hi Guys, 

There was a post about this a few years back and I called a bunch of those numbers and they were disconnected. 

I'm re posting to maybe get some fresh input.

I just recently purchased two duplexes in the East Nashville area. 

Does anyone have input on good property managers we can utilize? Guys who are really able to find high quality tenants (do appropriate credit / criminal checks) and do good / solid work. 

If anyone has any personal recommendations I would love to give them a call. 

Thanks!

Thanks for the Reply @Seth Mosley 

Do you think east Nashville is currently in a Bubble? Why are the properties selling within days for asking out there? You think the appreciation will keep going strong? 

If not East Nashville what other neighborhoods are you looking at? Madison? Bentwood?

Hi guys, I found a listing in East Nashville. Very hot area right now. East of Gallatin road. 

Asking $270K
Monthly Rent Roll is $2300
Taxes: $3k (i'm not sure why so high)
Insurance: 1K (assuming)
Prop mang: $2760 (10% of gross rents)
Maintenance: $2760 (assuming 10% gross rents)
Tenants pay all utilities and lawn work.

Duplex
2187sf
All utilities separate (water/elec/gas)
Separate HVAC units & water heaters
Off street parking (paved driveways) front & back (alley access)

UNIT A ($1450 Rent)
1242sf
3br/2ba

UNIT B ($850 Rent)
945sf
2br/1ba

I know this is a terrible deal for most people but can the Nashville natives who know the current market in Nashville let me know if this is something that would be an acceptable deal in that area? 

I know only suckers bank on appreciation but east Nashville has been growing so much the past few years, and only set to grow further. 

Any thoughts?

Thanks for the Feedback!

@Randall Young 

Hi Randall, I know this is an old thread but I too am looking for a good agent in the Twin Cities.

Any luck finding one?

Thank you!

@Johnathon Griggs 

Thanks for the reply! I've estimated 10% of gross rents for maintanence but that also includes capex expenses. I think that is the standard when dealing with older properties built in the 1900's.

Also I was told to always include property management in the calculations because even though I could do it myself and will probably do it myself, I'm doing all this work to make $. You really have to include the value of your time. I have a full time job and I make wayyyy more $ in my job than I would cleaning toilets and managing properties. So you have to take that into consideration. Plus you never know when you may leave town or need someone to manage so you don't want your margins to be too thin.

@Brent Coombs 

I can probably guarantee you that this property sold for very close to asking price. This is the 5th property I've looked at that sold in my area for very close to asking within 5 days on the market. I'm not sure what is happening.

And the reason the expense ratio is so high is because the owner pays ALL utilities. I think that is why it is throwing off the 50% rule. The rents are higher because all utilities are included. We live in the coldes climate in the US including Alaska and heat is the biggest expense.

thanks for the replys. 

Most of the numbers are directly from the seller. Only thing i added was lawn & snow, prop mang and maintanence. 

Its really good to know lawn & snow are covered under my expenses for prop manag. ill wont add that in my future calculations. 

Also, ive usually assumed a good maintanence ball park to be 10% of gross rents. there is no way for me to get actual numbers. Most of the properties for sale are older (built in 1930s). Is 10% of rents too high?

Click on the pics above for the MLS listing^^^^^^

Sorry for the dramatic title but I am really having issues with my numbers. I was hoping some of you guys could help me out. This is my first investment property. I've been stuck in analysis paralysis.

My numbers always get me pretty lousy caps and cash flow rates yet the properties I look at sell within a day or so. So someone is buying these. I hope I am calculating things propertly and not over estimating.

Here is an example of the most recent property I looked at:

http://www.realtor.com/realestateandhomes-detail/1...

Labeled as a Duplex but has four "sleeping rooms" in the basement along with a bath. No kitchen. Kind of a dorm. Property is right next to a big university in town. Solid B neighboorhood. Older property with baseboard electric heat and electric water heater.

Asking $225,000

Rents are $885 for each duplex and $315 for each of the four sleeping rooms (all current leases are month to month)

Total income: $36,360 annual - vacancy (I'm assuming 6% vacancy rate)

Utilities: $8500-9000. Owner pays heat. Owner pays electric for all basement sleeping rooms. This includes water, sewage and trash as well.

Taxes: $3000

Insurance: $1500

Maint: $3636 (assuming 10% gross rents)

Prop Mang: $3636 (again assuming 10% gross rents)

Lawn & snow: $1200 (assuming $100 per month) we are in a cold weather climate with lots of snow

SOOOO....

My numbers:

225,000 purchase price with 25% down (4.5% interest rate 30 yr) and $2000 closing costs

GOI: $34,178

Expenses including utilities and prop mang: $21,972

NOI: $12,206

Cash flow after mortage: $1946

Cap rate: 5.43%

Cash on cash: 3.34%

To me these are lousy numbers and I would never buy the place but it sold in one day! This is not unique the past few months. I've been outbid on numerous properties with very mediocre numbers.

Are my numbers off? Am I over estimating? Why are these selling soooo fast????

Any advice would be greatly appreciated.

Thank you!!!

@Jeremy Baker 

sounds like you have a hawaii success story! Congrats. I looked into hawaii last year and prices were just wayyy to high. Also it would be our first rental property and we assumed managing from the mainland would be tough (at least we think).

We do vacation there at least once or twice a year and though we could at least write off part of our trips, but the cash flow is so illusive there. Lots of speculators who bank on appreciation buy there.

If anyone who is currently looking at property in Hawaii ever come up with a deal I would be really interested in finding out more. Keep me in mind!