All Forum Posts by: Account Closed

@Mike Cumbie fair point. He at least needs confirmation that the repairs were done correctly. Pictures and invoices could suffice, but seeing the work in-person would be better. Seller could make it clear that they have upheld their end of the deal and no additional work requests will be considered. But understand your point about jeopardizing the deal.

Nice work. A few nits and nats: 1) $268 purchase price includes your $3K down payment, so total project cost is $283K. 2) Is your "value after repair" what the house will be worth at project completion or in 5 years? It's conservative to assume no appreciation... just asking. 3) Have you considered large expenses like replacing appliances at ~10-15 year intervals? Assume that's what your CAPEX budget is for. 4) Don't forget the tax benefits of depreciation and other expenses. Depreciation alone should be something like 25% of ~10K = $2500/year back to you at tax time.

@Vlad Denisov focus on cashflow and do a good sensitivity on vacancy rates and you’ll be fine regardless of the broader market.

@Ben Gabin I would push for another inspection. Seller refusing to let you back in just seems fishy... you don’t want to wind up owning an expensive problem.

Agree with others on durable materials.  Nobody can wreck stuff like college students.  No carpet = no steam cleaning / carpet replacement... vinyl plank looks modern and is waterproof and indestructible.  Separate bathrooms are a must... open, modern living spaces.  If it doesn't cost too much extra, go for high ceilings.  I'm not sure about the value of 3-bedroom vs 2.  Thinking you could do well with 1-beds, but the cost for individual kitchens might be too much. I think 2-bed is the sweet spot.  With students you're effectively renting by the bed, not by the apartment.  30K students is a good-sized school.  I'd call around to the other complexes nearby and see how many units they have available to get an idea of vacancy / demand.  

Nice model.  A few feedback items: 

1) "Initial Mortgage Amount" is calculating the down payment... not the mortgage amount.  

2) Annual maintenance expense seems too high.  Maybe higher in the first year, but probably should go down in year 2. 

3) Inputs/outputs are a bit spread out... would be nice to have consolidated input/output tables next to each other, so you can quickly see the impact of your changes.

Agree with @Brian Burke on this one.  You need to vet the sponsor and be sure you're comfortable with the deal.  Attend their offering webinars and read their placement memorandums... poke holes in their assumptions and make sure you get good answers.  Talk to others on BP about investing with them and how they actually delivered on their returns in the past.  Good luck!

@Nate Gottesman I see 2 main benefits to the right mentor:

1) Accelerate you to success faster than without.

2) Help you avoid large costly mistakes that could sink a first-time MF investor.

@Scott Morongell thanks... will do. Good suggestion.

@Tracy Streich thanks... will reach out soon!