All Forum Posts by: Bill Jacobsen

I calculate value based on current rents + 1/2 the value of increasing rents.  I come to a value of about $212,000 assuming that no repairs are needed.

Is there any laundry services on the property?  If not, I think that is a problem.

Good Luck.

Bill

If you can sell the house at your stated value with 7% sell cost you will have $142,000 not counting tax issues.  You state that you are making $10,000 but I suspect that appreciation is more than 1%.  You can calculate your current return on equity and decide if you are making enough.

Good Luck.

Bill

I am interested in properties that can give me an 8+% cap rate.  If I am looking at 1-4 unit properties I am not going to know what comp. cap rates are for other 1-4's.  I will evaluate my subject property and determine a projected cap rate.  I can also try to get comp. sales to determine a current value.  I prefer that the property is valued under my potential buy price and also provides me with the desired cap rate.

Bob, I hope that answers your question.

Bill

To me it depends.  If I am looking for a buy and hold to purchase I am going to use a cap rate.  I prefer to buy a property that is a bargain based on cap rate and comparables.

Bill

I would be glad to give my opinion.  Remember that it is only one persons opinion.

The best to you.

Bill

Given your rent rates and a 50% expense ratio and a buy price of $175,000 you have a cap rate of about 5.6%.  If I were loaning money I would want 10-12% plus some points.

If your friend were to be an equity partner than he would probably need 1/2 of the profit although I don't know why he needs you.

Unless this property has a high ARV I would pass.

Good Luck.

Bill

If your sister has not received help from this site why did she recommend it to you?

There is enough information on this site for anyone to learn how to be an investor.  The problem is that your sister is afraid to go ahead.  She is afraid that she won't be successful.

If I were a newbie looking at this site I would look at all the people 

 who have been successful in all parts of the country I would think that there was a good chance of my being successful.

Has she made offers?  Where is she stuck?

Good Luck.

Bill

I don't know what you are trying to do so I don't know if you are doing anything wrong.  You say that you are a real estate investor.  Are these properties that you are not interested in?  Are you a realtor trying to get a listing?

If you are not interested and other investors are not interested it sounds like the prices are too high.  Without more information it not possible to give possible solutions.

Good Luck.

Bill

I would probably double the estimate for maintenance and capital reserves.  That would put your cap rate under 8%.  Since your cost of money is 5% I would want an 8% cap.

Good Luck.

Bill

  If you have 30,000 and can compound it at a annual rate of 10% per year for 118.19 months you will have a little over 80,000.  That is the same amount you will have if you earn 400 per month and compound it for the same amount of time.

Bill