Hi All,
I grew up in Iowa City and have a few rental properties in the area, Coralville, North Liberty, and Iowa City. Two four plexes and a few two bed one bath apartment units.
I found an off market 8 unit building that will cash flow about $500/month. It is very well taken care of and has a lot of long term tenants. No deferred maintenance. The bank is asking for 20% down which comes to about $110,000. There isn't much room to create additional income, I think rents are correct and I do not think it would appraise for much more than the seller is asking so private money or seller financing don't make a lot of sense. I think the seller is asking a fair price and she is not interested in closing until January, so plenty of time to find the down payment.
At no money of my own in I think this is a great deal. The first person I spoke with is willing to put in $60k for 50% of the deal. Which would have me putting in $50k for the other 50% of the property. My questions to the forums are do you think I can find a better way to structure this? For the value I am adding, finding the deal and doing the day to day management going forward, I'd like to receive a little more that a free 10% of the property. I would be happy with 20% of the deal at no money and finding two individuals will to put in $55k for 40% of the property.
My other concern is the health of the market. Being in Iowa we typically, from what I've heard, do not get hit too hard by the economic down turns especially relative to other parts of the country. Also, I saw today that Iowa unemployment is down to 4.7% which is a good stat especially during COVID. That said, with a presidential election and an unforeseen pandemic is this a stay away until the waters are less muddy?
Thank you all for taking the time to read this and providing feedback.
