All Forum Posts by: Brandon Carriere

Thanks for the opinions guys..  I've been debating this one for months, as its an off market opportunity..  Wish I could get her down on price, but she's a stubborn old retired realtor who will take this place to her grave otherwise..  

 I'm leveraging equity out of a paid off property for the down payment, so it's minimal out of pocket..  That dead equity for some reason is mentally killing me..  Why not make an extra $250-300 per month to help scale a bit faster..  

@Kevin Sobilo

Yeah, I tried to be conservative with my numbers..  Would rather err on the side of caution, but yes, I think I could free up an extra $50-100 pretty easily with more exact numbers..  Also, I think with some minor cosmetic upgrades, I can prob get both studios up to $400 or more..

@Dennis M.  

At first, I was thinking the same Dennis, but having knowledge of this market like I do, theres likely NOTHING here that will cash flow at that rate..  The rents just aren't high enough for it to be feasible..  Yes its a triplex, but realistically with 2 very simplistic studios, I almost treat this like a duplex in regards to $ per door..  There aren't an abundance of multi family here in this smaller town of 20,000 people, so I've gotta make due with what I can..  I have a great team here, and I'm not ready to branch out to Milwaukee or any other market in the country and try to chase the big returns that some of you guys are getting..  I've got a handful of similar rentals that I've had for about a year, so maybe someday when all these singles or doubles I've got start cranking, I can branch out and take advantage of that..  The whole town here is a B,C, C- class..  Its a working class town with lower rents in general, but very consistent and reasonably priced..  Not a rough area by any means.. Tenants as with any C areas can be a challenge sometimes..  

@Jay Hinrichs

The property is definitely not sexy by any means, but I believe it has a newer rubber roof, (which should if done properly, last a LONG time)  and the furnaces are 2013 which could last 25 yrs or more..  I think its all vinyl sided which should last equally as long..  Structurally seemed to be fine and I believe electrical is all updated to breakers and separated..   If I move forward, I'm going to fly up there and meet the inspector and make sure these big ticket items are as good as they seem to be..  I'll make sure he inspects the *&%$ out of that place..  Anything can happen, but if I can avoid those, then I can handle the cosmetic and replacement appliances etc over time..  These kind of areas, people don't expect the Taj Mahal, just a clean reasonable living space..  Standards are definitely lower than most of us are probably used to..  I have access to pretty cheap labor there which also helps..  

Thanks again guys..  The way I see it, is its not a home run, but could keep me moving in the right direction..  

@Account Closed

6% is a guesstimate..  It'll be at least 5.5 though..  25 yr amortized, prob 7 or 10 yr adjustable..  

The property is maintained ok..  I think most of the big ticket items are dealt with, so just cosmetic upgrades possibly needed in between tenants.  I wouldn't drop a dime until I need to, as I think its still fully occupied with a couple of the units just turned over in the last 3-4 months in its current condition 

Been debating this one for a few months, off market deal..   

2bed/1bath  and 2 smaller studio units..  Small town, war zones don't exist here..  To my knowledge, a rubber roof, newer furnaces..  Multi's are relatively hard to come by here

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*This link comes directly from our calculators, based on information input by the member who posted.

@Ann Duckworth

So sorry to hear that..  Pretty standard for the Open Door fleecing..  Wish people wouldn't fall for it, but it is what it is..  Glad you came on here and made your experience known..  Maybe you'll save someone else from falling for these gimmicky bait and switch tactics thats invading the marketplace.. Not sure how I'd do it, but Im so tempted to advertise in my local market that I'd sell listings for 1% or less to those sellers who are considering open door, just to avoid honest hard working people from getting bent over by these companies..  

Why Houston?  I know nothing about Houston, but imagine it would be expensive with very little or negative cash flow, like other big cities in TX..  

Why not start smaller and NOT refi or sell your home at the moment?  Take a small chunk of your capital and start with a small multi in Jax or Birmingham or somewhere closer than TX where you can cash flow?  Going for the home run at whats probably a short-medium term peak in the market, with no experience, seems like a recipe for troubles..  Im just thinkin out loud here..  

Last year I had first time home buyers do a final walk through the day before closing..  We opened the front door to a flood covering about 1500 sq feet of the 1st floor of the house..  Seller ended up giving a credit of $7200 to buyers at next days closing, to help buyers immediately remedy the problem..  It can happen, you just need to ask, or demand that it happen.  You should have the leverage at that point..  

As Bill said, if its nothing and its a good deal, let it go and close

@John Warren

I love Khaki Oak too..  Great choice..  My favorite!

No taxes or insurance?

Capex and repairs %'s seem a bit low..

Management?  Seems that this will be negative cash flow when these are adjusted

@Sandra Evans

Im not a property manager, so this is all just a hunch, but you have to be under a lease still.. You just happen to be month to month..  Any lease I've ever seen has some sort of 30 day advertising or showing period, which means you allow the home to be showed and marketed during the last 30 days to find a new tenant or buyer..  

You can make their life difficult by not cooperating, but remember, you're at the mercy of their references in any other home you try to rent in the future..  I'd either deal with it, or move as soon as you can..  

@Account Closed

I cant imagine a scenario where the sellers wouldn't move forward with you, if you changed your mind and didn't cancel..  The sellers aren't "giving the earnest money back to you"..  The money is sitting either in a brokerage account, or a title company, or wherever your state puts it..  In order to be released back to you, or split between you and the seller, BOTH you and the seller need to sign a release for that to happen..  If you or the seller refuse to sign, the money will sit in escrow forever and the deal is essentially dead..  

 Depending on your states laws, that may prohibit the seller from moving forward and accepting any other offers until yours is resolved one way or another (which again may give you leverage to get some or all of your earnest $$ back..)  Reason being is that youre technically still in escrow, and you cant really be in escrow with multiple buyers for the same house..  Once the contract officially ends, your leverage dissipates a bit 

And yes, I'd lose that inspectors phone number and find a different one..  

If I was your agent (laws could be different there, but probably similar premise in any state) I'd call the other agent and explain its in the sellers best interest to split the EMD with the buyer and be done with each party going their separate ways.. It would be pretty easy to play hardball and make that happen.. Now, its unfortunate the way it played out and your inspector basically screwed you.. You don't really deserve the money back (not really your fault but more-so your inspectors) , but with all the leverage you have, your agent should fight for you and get 1/2 of the EMD back for you regardless, because thats their job..

Good luck..