All Forum Posts by: Brian Morgan

Of course 30% is high, but I'm just using the info given. I normally use 5%-10% depending on area.

So, one of two problems. The property manager is incompetent. Or, the building is cancerous. If units are turning over in 6 months, I am inclined to believe the latter.

Lastly, We are valuing the property for cash flow as it sits for purchase today. Don't hedge on what it is worth in the future with new management and rehab. If you know that the vacancy factor is 30%, then that's what it is.

Paying 176K plus rehab for this property is a mistake!

Sorry Uwe, but your numbers aren't accurate in this case. Yes, you should calculate the gross income. But, you must take into account the vacancy factor. In this case 30% or more!!!

I calculate it this way. I'll use your $58,000 Gross number for the example

$58,000
-$17,400 (30% vacancy factor)
-------------------
$40,600 Net Rent
-$4,060 (10% maintenance reserve)
-$4,060 (10% management)
-$4,300 (Taxes/Ins)
-$12,000 (electric) Natilie said $100 unit/per month
-$ 2,400 (Water) if $200 a month is right, I project higher for 10 units.
_____________
$13,780 NOI @ 10% cap rate = purchase price $137,800

Given the trouble you have already listed about this property. I would not recommend this deal!

Just stumbled onto this

1) If BiggerPockets put on a conference, would you want to attend?

Yes, I think this is a great idea!

2) Would you be willing to travel (fly) to attend such an event?

I would likely be willing to fly, schedule permitting.

3) Do you think 2 days would be adequate for a first shot at it?

Yes, I think this is totally appropriate

4) What kinds of ideas do you have for sessions?

Topics on various strategies, I think everything has been mentioned already.

5) What would a BP conference look like to you?

I would envision it with a morning and afternoon session, and steam release cocktail type networking at night. Say for Example, 50 minute blocks where you could choose from 3-4 different topics/presenters depending on where your interests lie.

6) Of the real estate and other events that you've attended, what is the one thing that you've liked the most?

The chance to meet new people and discuss different ideas that I may not have thought of/heard of.

7) The least?
Being restricted by experience... All the Newbies together, All the advanced people together. I would be very careful how you label the topics and levels. A person could be an expert in Landlording and multi's, but a novice at SFR Fix and Flip and Notes. Again, not sure how this will be structured, you obviously want something for all, but I would be careful not to bracket people too much, and let them choose on their own.

Certainly interested to hear more about this idea!

As a general rule, I do not give out any information about my tenants.

I've received inquiries from rental companies and I politely explain that I am not at liberty to divulge any information regarding tenants without their written consent. I usually mention that if they are looking for address verification, then the tenant can provide proof with a current utility bill.

I also politely explain that I am on the do not call list and to please remove me as a contact.

Of course, I will give positive references when asked specifically by the tenant in advance. Obviously, I wouldn't want to prevent them obtaining rental items.

However, if it comes out of the blue. I would suggest not disclosing anything

I'll agree with Kevin. I'm from Mass as well and have started looking into Detroit. I'm intrigued by the idea of picking up Single family units at $10,000 a door, that rent for $850. Cleveland and Columbus also have similar deals.

I hope to be flying out to Detroit shortly to see what it is all about. Worst it will cost me is a plane flight. Looks promising on paper though. Certainly better than out Massachusetts Market

Thanks Dionte, Your post was very helpful!

I'll bid 9% :-)

It's seems that everywhere I look lately, people are excited about the action in Cleveland. So much so, that I am thinking about possibly flying out and doing a few deals out there before winter.

Only problem is that I know absolutely nothing about this area. Can someone give me an idea of areas and towns to target and which ones to stay away from?

I'd be looking for short term fix and flip, as well as longer term rehab, rent, and hold under 75K. I know that isn't a ton of info, but let's start there anyway!

I've heard that debt collectors may buy it outright for around 10-15%. I've also heard of other scenarios where agencies work on contingency basis for 50% of the total.

I've never used any service like this, so if I am off target with the numbers, please feel free to correct me.

I agree with Jon. Don't throw good money after bad. In my experience, it will be unlikely that you'll be able to collect, even with a judgement. I currently have a $3,000 judgement from a recent eviction. Doubt I will ever see anything from it. I'd be happy to sell it cheap if anyone is game ;-)

Best of Luck!