All Forum Posts by: Nick Horob

Thanks!  Same guy we chatted about.  I'm definitely down for a few more beers.

Table didn't past well in first post.

I completed a direct mailing to small MF owners in Fargo, ND.  I sent 400 letters, received 25 calls, and found 5 "hot" leads.

I signed a purchase agreement on Friday to buy two 4-plexes for $330k.  Not quite the 10% cap rate I was targeting but close.

They are all 2 bd, 1 bath units fully rented for $500/mo.  Landlord pays heat which averages $100/building/month.  $200ish from Nov-March.  

Borrowing $235k @ 4.5% and 20-year amort. $100k downpayment.

The rents are approximately $50 below market so I'll be looking to adjust those as leases expire.  If I can get the units to $550, the cash-on-cash will be 15%

Here are the initial numbers.  Just wanted to share!

I have a $60k offer in on a tri-plex that needs approx $10-15k of work.  Even if we can settle on $70k, that deal should be 12% cap rate and 16-17% cash-on-cash.

Not home run numbers but they fit my plan.  Best of luck to the rest of you!

@Paulina Purnama I'm in Fargo as well.  Finding a 1.5% or better deal here (or in a decent area of Minneapolis) is very hard to do.  

I'm looking at a couple 4-plexes that are 1.2% but I haven't come across anything much better than that. 

With the collapse in oil prices combined with a rocky ag economy in the area I expect to see some more attractive deals in our market over the next year or two.

Thanks for all the great advice.  I'll let you all know how it turns out

Thanks @Peter MacKercher .  Good advice.  I'm going to use that approach.

I looked at the property this afternoon.  It's in good condition and would likely require less than $1,000 in improvements.  

Part of me thinks it would be worthwhile to overpay a bit to build the relationship but what's the point if he wants full retail for all of his properties.   

I recently started a direct mail campaign in Fargo, ND.

I received my first call today from an 88 year-old investor who owns 50+ houses in the area.  We had a very good, lengthy conversation about his background.

He's interested in selling a house for $139k that would rent for $1,100.  I'm targeting gross rents of 1% or more so this doesn't meet my target.

I'm thinking about calling back and offering him a $110k all-cash deal and simply explain my rationale.  I want to build the relationship while maintaining fiscal discipline.  

Any suggestions on how to handle this situation?  TIA

Replace his gold and commodities w/ real estate and you might be on to something

Thanks @Bill Exeter!  I'll do some research into the entities you mentioned.