All Forum Posts by: Brian G.

@Engelo Rumora Done, I just gave you a well deserved vote. Here in Miami you hear this type of stories every now and then. If is not the seller or the bank or the contractor or the buyer or the city sometimes you sense they are all conspiring to get you. Agreed, we must slow down and look at the trees not just the forest. Thanks for sharing and continue expanding into the market. All the best

@Dennis WilliamsGreat persistence. The goal is to have leads identical to this one x5 EVERY month.

Enjoyable pain.

Interesting. Different cash flow outcomes depending on who's being asked or their location.

Question: Talking reserves for a moment. For main repairs and CAPEX. Say you want to compare triplex units. All similar construction with comparable concrete walls and shingle roofs. All are equivalent in size. All are located in B class inland areas. All units are as originally built and nothing has been replaced or improved (including HVAC). The only thing that varies is the year built. What reserve % would you estimate for repairs and CAPEX on the structures considering the following year built ranges:

From 1960 to 1970?

From 1970 to 1980?

From 1980 to 1990?

A better outcome solving Cap Rate with the appropriate NOI calculation...

Lets revisit this deal for the sake of learning. Do take it easy guys. No need for rants. I am buy-n-hold nearby this Miami area. I don't own multis but do own SFR's. So multi-families have been on my radar for some time.

I re-did the numbers considering observations made from various posters above. COC is probably not as originally planned but still a healthy 16.6%. I am getting a Cap Rate of 4.2% (anything wrong with these formulas?). Repairs are at $3000 annually (under normal conditions) and this is with solid lease agreements in place. I just don't see how this triplex can have more than $3000 of consistent repairs or CAPEX a year (however I do noticed where avg built year for these structures is around 1960-1975). The market rental is hot in this area and pre-showing the units and having a new tenant lined-up by end of existing lease is very doable. I know. I know... for sake of this exercise I will consider 3-months vacancy rate. This is equivalent to one month per unit per year (trash-out, touch-up paint and clean-out before re-occupancy). @Mike D'Arrigo very accurate your suggested 15% (vacation/repairs rate). Here are the numbers:

Is this more in line with reality? I know this is all proforma. I'm just attempting to have educated estimates. @Patrick L. @Account Closed It was not intentional to hijack your post - just trying to learn. 

@Allen Maris I see your post got some unwanted attention. @Mark Brogan has a good point "dont pay attention to people that give you a hard time". The sector is already plague enough with issues, inventory levels, title clouds, marketing ideologies, negative people, bad advice, yada yada. Distractors.

Instead, why don't go into the market with such a force, with such a dominance where all these yada yada doesn't have an impact on destiny? Maybe I sent a piece of marketing that caused my local broker to drop me. Who cares.  I will get another broker to hang my license with. And the day I can't find a broker or decide not to be licensed it will not matter anymore. By then, I will be the principal closing/disposing my own deals. The license was never required and becoming a realtor was never part of the plan. It was just one of many temporary bridges to get me from point A to B. 

Considering Cardone's success formula below and you are right on track with #1, #2 and #3:

1. Attention 2. Criticism 3. Haters 4. Admiration

Continue expanding into the market. All the best...

@Carlos Rovira 0% vacancy? Well it depends. In this area of Miami is (with the proper due diligence) achievable. Hopefully damages are minimal and turnarounds are a non-issue. Im talking about trash-out, touch-up paint, clean-out and multiple offers all on the first week. If you move fast you could achieve it. 

We own RE less than a mile south of you - Doral. Down here the new developments (residential/commercial) are pushing sales/rentals upward. One of our units is already at 8% appreciation in six months. Rentals have jumped $200 (sometimes $300) a month. The city here is promoting the premium high scale life and things are - hot. It seems that we both saw the same writing on the wall. 

The bottom of households are finding ways to cope with the incrementals. Their alternatives are areas like Hialeah and Miami Lakes. So they are heading your way. Anything north of this and you are now in Broward County. This deal you acquired is solid. Hopefully Roofing, HVAC,elect/plumbing are sound. Congrats and we also consider multi-families if the numbers are similar to yours... All the best.

The successful investor without academics usually knows what he wants early. He/she understands the importance of first; marketing and networking without ever receiving lecture on those 2 words. It's 2nd nature to them. Some of them I've seen delivering impactful presentation influencing other executives and MBA's. 

The successful investor with academics knows what he wants but becoming a leader of an established corp and having other streams of income in parallel to RE is not a bad idea. Their success depends on how well they develop the same non-lectured skills the investor without academics gains every time they influence other executives and MBA's...

@Erin P. I have seen this one before. Not the same but similar scenario. Not me but a good friend of mine. He was tipped off that the seller family members could not move out right away after closing. He inmediately involved his attorney and was able to secure and agreement with the seller to have access 100% to the property after closing. At the closing date he showed up on time, funds were at escrow, the seller was there, and his brother showed up at the property. My friend didn't close until his brother confirmed the property was vacant. Lots of back and forth and many hours to close the deal. 

@Account Closed great work! I was somewhat in the same position. Mine appreciatd over 8% in just 6-months here in Miami. Hands down a triathlon to acquire. Ive run the spreadsheet like 50 times in the past months... I just cant dump it. Will rent to cash flow. With paper losses, tax deductions and appreciation, imagine the numbers a year from now? Im just in a different state of mind. Your job looks amazing. Remarkable facelift. Good luck on the next one.