All Forum Posts by: Casey Miles

Hi Dennis and welcome to BP!

What are the details on your first rental? Location, SF or MF, what type of cash on cash/CAP rate are you getting on it?

Good for you on jumping in on the RE world!

Hi Sandy and welcome to BP!

There are tons of ways to make $ in real estate. What specific type of RE are you interested in? This will help you get more relevant answers.

Take care,

Casey

Hi Kevin,

There are always exceptions obviously but generally speaking the margins on cash on cash and CAPS are smaller the farther north you go here in AZ. Tucson having better #s than Phoenix, Phoenix having better #s than Prescott, Prescott having better #s than Flagstaff. I've seen property outside the populated areas that have better numbers on paper but you might have a vacancy issue. 

There are lots of MF repositions in Phx right now buy there not even 3 years old. I probably did the quick math on 10 properties yesterday. All but one (if I recall correctly) hadn't been bought/sold in the last two years with over half being bought/sold in the last year. I will admit that I don't look at market data as much as some and I mainly take an individual approach on properties to see if they work for me. With that said we're at a peak for me personally. There are still people buying buy it's not me.

Be patient in your search but be ready to execute when that perfect property comes along.

Good luck in your search,

Casey 

Hi Jeremy,

Your cap rates are going to fluctuate. Especially amongst different classes of neighborhood. You'll always want to run your own numbers (and run them the same way every time) and don't rely on what's reported on the MLS/brochure. Some agents/sellers list pro forma numbers (especially for income) rather than actual. Also keep in mind that there might be deferred maintenance on some properties resulting in a higher initial capex than routine R&M. In the perfect world everyone would price properties at the respective cap rate for like properties in the same area. That doesn't happen, although some on this forum believe it does. You're always going to have people who think theirs is worth more and those who just want to get out from a property. It's more accurate to say cap rates have a range. I literally analyzed three like properties this week in similar neighborhoods. They ranged from a 6.5 to an 8.13. I'd say if you're seeing a >9 cap rate you're in a C/D neighborhood or you've found yourself a fire sale!

Hi Grant,

Welcome to BP. What type of investing do you focus on? Do you invest in the valley or out of state?

Take care,

Casey

Hi David,

DTI is always going to be tough regardless of the lender. Usually local/regional banks will be better and most will consider using 75% of the proposed property's income towards your DTI. Are you claiming the rentals you currently have on your taxes? If not, you'll wanna start.

Best of luck, 

Casey 

Hi Gene,

I'm an investor, I'm friendly, and.... I'm a real estate agent :)

What type of properties are you interested in? Are you looking for buy and holds, flips, commercial, residential? How much experience do you have in RE?

Let me know how I can help,

Casey

You're saying you have to annalize the entire market a property is in to determine if a specific property will be profitable? It's almost like you're saying all properties are valued the same within a given market and there isn't a need annalize properties on an individual basis. I know you can't be saying that so what indicators do you use to annalize specific properties?

Thanks,

Casey 

Hi Michael,

There are definitely a few investor/agents here. I'm primarily an investor who is also an agent, investing is my primary focus. I'll try and answer your questions from my perspective.

• I'm comfortable with low offers but nothing unrealistic. I won't spin my wheels offering 40 cents on the dollar or anything. If you want to fire off 100's of lowball offers you'll want to find a more hungry/green agent for this.
• I like MF (although this is pretty dry right now) and single family in B and C neighborhoods.
• Personally when working in the <$250k arena I'm not going to physically check out properties prior to showing them. I'll run some quick numbers, etc. on all properties but I won't physically check them out beforehand.
• I have a lender I prefer to work with and a few vendors too.

Are you looking for buy/hold properties or flips? What type of properties are you looking at? I'm assuming SF since any MF in the 100-130k range is probably going to be a disaster.

Good luck and happy hunting!

Casey

Start licensing to podcasts too. I will say there is a ton of stuff to learn and you won't be able to learn everything. Don't get caught up in learning so much that you get analysis paralysis. I see a lot of new investors get to this point. You don't want to be careless with your money a jump into a bad deal but don't be afraid to learn the basics and execute.

"Cash on Cash" = rate of return on the actual cash you have to put into the deal such as down payments and acquisition costs.

"CAP rate" (Capitalization rate) = represents the rate of return on the capital investment. If you were paying all cash for a property this would be the rate of return. You essentially determine the NOI (Net Operating Income) and divide it by the purchase price.