All Forum Posts by: Caleb Heimsoth

@Gino Tomba

When I got this quoted in cleveland it was more, and that was several years ago.

This seems fair to me.

@Gabriel Novotny why not just sell the property and let everyone cash out? 7 percent doesn’t seem like a great return. Letting your brother be a property manager doesn’t seem like a good mix. Is it rented currently ?

@Nicholas Seaver are you willing to pay top dollar for this service? Most CPAs and/or attorneys will bill at 200 dollars an hour or more. That can get very costly as you bounce ideas off them.

Tax strategy is best for people with millions to invest. Does that apply to you? These are just a few basic questions I would consider before moving forward

@James Wierzba step 1 is to hire a New property manager. You have a vacant property and presumable no keys To said property.

Is there any old rent money with your old PM?

After you do step 1, I highly recommend you go see this property in person.

@Leon Lee what areas are your other properties in? This is very common for C class multifamily tenants. You should mail a letter and email them the same letter if you have email addresses. I wouldn’t text them at all.

They’ll likely not respond to either and then you try in person, which will also be slow.

Tenants aren’t stupid, they know when rent a due. If they don’t pay rent, follow the laws, but that’s in my experience.

You’ll likely lose a few tenants in the coming months. I would recommend someone local, to PM or at least help out.

@Ron Angel so you have an investment that has cost you money to own vs say the stock market that has tripled in value the last 10 years? This is obviously a terrible investment and you should sell them

@Patrick Ford 1. Fix the issues 2. Wait 6 months or 3. Use a different loan.

It’s unlikely the appraiser will change their mind. That’s an uphill battle.

@Rick Estacio I’d negotiate strongly as this is going to be a major headache for you, not to mention the potential damage once they are out.

I’d start at 50k price reduction and see what the seller says

@Rob Hakes how was 2020? Better than 2019?

@Ashish Yadav I never bought from them but I visited them and went through the whole process (before purchase) in 2017. I thought they were expensive then, and I imagine it’s the same or worse now, given the market. That being said, I have purchased turnkey in memphis and so I am familiar with the market. I’ll give my opinion on your points below:

1. It won’t be cash flow negative if EVERYTHING goes perfectly. If you have a tenant leave or major capex, you will lose money. If a tenant leaves after 2-3 years you can still lose money. Good rehabs are important, but regardless of that rehab, you will have turnover costs. Turnover costs (rehab) plus mortgage payment plus lease up fees can easily run 4-5k total. I once had a tenant leave 9 months apart (In memphis) and I had to repaint that whole unit. Think what 5 years would look like. If you do cash flow, your total return won’t be great. 6-8 percent long term, potentially less. This doesn’t include appreciation, but at this point that would be minimal.

2. In my experience, this is around correct. I think it was around 40k when I looked into them

But that was a few years ago.

3. I was quoted most properties go under contract in 48-72 hours. This is much slower then minutes but it’s still quick. It could be faster now, market is very hot and they sell a quality product.

4. At least in memphis, this fee structure is common for every major PM. It’s similar in other major “cash flow” markets too. Where I live in Raleigh, NC it would probably be slightly expensive, but this is entirely market dependent .

Let me know if you have any other questions