All Forum Posts by: Chris Youssi

FYI should have mentioned all my props are in Sycamore in 1 multi family / condo / townhome project. City has a much higher average family income - 90K I believe than in the surrounding markets. Type of markets we prefer for our doors. Lots of excellent comments on this thread.

1 Vote

Try Townsend property management in Dekalb. Also try (Dan) Pavelich May in Sycamore, IL sister city of Dekalb. Feel free to use our name ( pronounced Yow c ) for both referrals. They each manage HOA's that we developed in the area and are responsive . Re ROCKVEGAS - have about 30 SFR and another 40 in the area - excellent cash flows. We have A B C class properties so cover a wide range of doors. EG... we sold oe of our SFR in early summer were renting for $1150 - new buyer was an investor had it rerented ( not section 8 ) day of closing for $1450 blew me away - point is always room for improvements and fresh approaches to our market.Happy hunting!

0 Votes

Too many unknowns with your question. Here are a few questions?

1 - What is avg sale price in the market you are wanting to invest?

2 - Being that your a contractor do you have a relationship with a commercial lender?

3 - Do you have the time to do your own updates/rehabs/ repairs?

Once I have these answers I can offer some more guidance. FYI , as a GC /Custom homebuilder i have bought close to 5M worth of props from 2013-2018, still own 3M /25 doors . I have done all this with $60-65k of my own funds . The rest was BRRRR on steroids - so EZ when you apply the same concepts as a homebuilder to rental portfolio.

Happy investing!

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Assume everything is entitled - meaning zoning utilities etc.. are all in place and that prop is shovel ready to commence construction. We built new about 20 rentals this year combination of 4 families and 2 families. 2021 hope to ramp up to 40+. A few points to consider:

1.) Lot can be equity depending on lender

2.) GC / development fee also acts a equity

3.) Upside looks very strong 68% LTV

Looks like a no brainer to me - most lenders in my market would finance with no additional cash based upon your numbers. Why sell? rent for 1 year flip into 1031 exchange or pay capital gains. Best wishes moving forward.

1 Vote

Originally posted by @John Erlanger:

Originally posted by @Steve Vaughan:

Originally posted by @John Erlanger:

Originally posted by @Steve Vaughan:

Originally posted by @John Erlanger:

Originally posted by @Steve Vaughan:

John, you clearly do not understand cap rates and are making assumptions and comments as if you do have an understanding, which is why the hostile responses. In its simplest form it is IRV . Income divided by return = value . in other words income if your NOI aka I ( ASSUMING NO DEBT ) IS 100,000 I DIVIDE THAT BY 7% AKA RETURN ( CAP RATE ) THAT WILL EQUAL V (VALUE ) . In the scenario above your value is $1,428,571 if the cap rate is lowered to 6% value becomes $1,666,667 and so forth . The scenarios above assume A properties thus the lower cap rates. cap rates are calculated with A+ tenants in the commercial world such as Walgreens / Starbucks Target etc... and they are in the 5's depending on lease terms etc... HOPE THIS CLARIFIES . Now onto the question in the QC market in Iowa cap rates are low 6's - in the Franklin , TN market they are in the 5's.

I am a buyer when the market cap for quality is closer to my ROE min of 7. I can still purchase at that, just not on the MLS.

Since cap rate is agnostic about financing and ROE is 100% dependent on financing and cap rate values property and ROE measures return how do these meeting at 7 have any actionable meaning?

Whether it's actionable or not for you doesn't matter to me. I don't recall asking your opinion.

As someone in the preservation phase of their financial journey all I said was any less than a 7% return I'll invest in things that require less work. Return meaning IRR, which factors in PP, which factors in cap rate as a return metric.

ROE is dependent on financing? I don't see that, unless to argue that I could put financing on RE at less than 7% to optimize return. But whatever, I buy mostly with cash, but may begin to put financing on buildings as rates trend lower.

Um, I didn't give an opinion. I asked how that was actionable to YOU. If you are just playing with meaningless calculations that is on you. The market must be tanking for some if a simple question is met with such irritable replies!

ROE is your return on equity. Do you know how to calculate that? If you put 99% down or 1% down your equity and financing will change the ROE. Am I wrong on that?

And how is that 7% cap rate a return?

Recently finished AI's Advanced Income Capitalization Course so anxious to use the learning.

Check this out, https://www.biggerpockets.com/...

Thump your little textbook on someone else. I don't want o be mentioned or tagged by you anymore.

As my Mentor always says, If someone is too smart to answer a simple question then they have given their best answer. Bye, bye.

2 Votes

Why not have the best of both worlds and do both?

Refi your long term debt in the secondary market and then refi your commercial debt per your initial post. Also an FYI an earlier post stated you can wrap everything up in a commercial loan and then start new in the secondary market. I would double - triple check that with your secondary market lender ( 30 year fixed rate ) as I believe this is incorrect information . Reason being is you will have reached your limit in the secondary market for new loans based upon number of units you own.

My thoughts - happy hunting!

0 Votes

Just extend it to Sep 15, 2020 NBD

1 Vote

Morning Jake couple of ideas.

Not interested in college - get your residential real estate license start selling. While you are selling, obtain your Brokers license and then advance to obtain your CCIM designation - equivalent to an MBA . The network is strong and extremely helpful.

College - obtain a degree in financing and marketing IMHO. I would get your geneds out of the way then interview some successful CCIM members and follow their guidance.

Happy hunting!

0 Votes

THX for all the responses as predicted the vast majority have not communicated and are still on track for collecting 95%+ receivables. Not sure why one would do it any other way. As has been discussed and needs to be top of mind this is a business and as such we have obligations to our lenders and other vendors. If someone choses to allow their business to be charitable good for them but for most of this this is not feasible . Happy investing!

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Curious to see not only how many communicated or did not but what PERCENTAGE of rent did you actually collect based upon your communication or lack thereof? I personally only addressed those tenants that contacted us about 10% of our ( 5/6 out of 58 doors ) holdings . We have collected 96% of all revenue as of this morning. Currently only ones waiting to pay have filed and are waiting on unemployment to arrive. Now that the dust is settled and we are 6 days into the month numbers should be very accurate of April's collections IMHO.

0 Votes

All Forum Posts by: Chris Youssi

Chris Youssi has started 5 posts and replied 282 times.

Post: Property Management DeKalb, IL

Post: Property Management DeKalb, IL

Post: Is 50k enogh to start out with?

Post: New Construction Financing On Land You Already Own

Post: What is the cap rate in your city?

Post: Traditional Vs Commercial Financing?

Post: How do I allow a couple extra weeks after issuign a 30 day notice

Post: Commercial Real Estate Advice

Post: How many of us actually communicated / our tenants about April $?

Post: How many of us actually communicated / our tenants about April $?