All Forum Posts by: Cristian Aviles-Morales

 I agree with you, but here is a question: What if one of your current tenants decides to adopt a dog that is an ESA right off the bat? (They swing the story that they met the dog many times before adopting so date of certification is on or before the day they bring it back to the unit). It seems like in that example, LL is out of luck. But nothing they could have done other than asking "Are you going to adopt a dog in the near future?" on their pre-screening application. Which they wouldn't be able to hold the tenant too if they answer no (I imagine?) since people can change their minds. 

@Matt K. By the 10% vacancy and moving away from the percentage for items, are you suggesting that he gets a real number $ for that in lieu of the 10%? 

So instead of saying 10% // $80 a month, what are you suggesting he replace it with? 

Still learning myself, hopefully I didn't come off as rude. 

Okay, on a napkin try to answer these questions:

Purchase Price: 65,000
Cash to Close: ?

Rent: 800

Property Tax: ?

Insurance: ?

Property Manager: 50?

Mortgage Payment: ? (This would be higher if you do 0%. Use BP's mortgage calculator and a conservative 5% interest rate)

HOA: ?

Vacancy (10%): 80

Repairs (5%): 40

Cap. Exp. (5%): 40

Total Expenses: ?

Now if you subtract your income from your expenses, what is your real cash flow per month? 

That answer will tell you if its worth pursuing or not. I financed with the VA with my personal property and I regret it because that mortgage payment is higher. But at 65k it shouldn't be too crazy.

So, I see that your down payment is 10% or 7,500 of the purchase price. 

PMI like Sam Shueh mentioned will hit you, so you're not accounting for that. Those thin margins will now be destroyed.

However, if you do have the 20% available and the repair costs needed, your ROI won't be that great but you'll have a profiting property. 10% for CapEx and Repairs isn't terrible and it's not the best. If this is your first deal its better to be safe, so I'd err atleast to 12%.

And for property management, unless if you know someone who will give you 7%, you should account for 10%. 

This "deal" is only a deal if you keep plugging more money into it, but that is giving you a lower and lower ROI. I say skip it. 

 Saturday, at 9. There's a group chat with the details that you can join. 

@Bernadeau Charles is the guy to talk to :) 

Ouch no insurance on your property? Lesson learned I hope. 

You more than likely will have to pursue damages through neighbors insurance provider. May even have to consult a lawyer. 

@Ryan Rogers Out of curiosity, why are you assuming such low CapEx and Repair rates (both only 2%)? Repair should be minimum 5% (in my opinion) with rockstar tenants and Capex should be (in my opinion) 10% especially for a 11 year old roof.

If you increase those, and still cash flow (which I think you will just not AS MUCH).. it can potentially be a viable deal. Not rock star but it's something! 

Have you already checked Zillow for Rent filters to see the rents in the area AND rentometer.com to see rentals nearby? Make sure your asking rent price is avg. If the property needs work, make sure the below avg is still going to cash flow for you.

If all that is addressed, then I think you're on your way closer to knowing if it is a good deal for you or not. 

If you bought it tomorrow, do you have a method to place tenants as quick as possible? Screening method planned out and criteria determined? Your own lease ready for them to sign that is iron-clad and covers you? If yes, then you're even closer to making this happen. 

If not, definitely get to the drawing board and draft stuff up!

Oh and, is this a MLS deal? I ask because the ask price suggests $250k but you are assuming you're going to get the property for 60k less than that. Is this a property that you already negotiated a discount for? If so, and if the numbers don't make sense for you, don't just give up the property and that huge discount. Turn around and wholesale that to someone who CAN make those numbers work.

@Spencer Dalberth & @Kelly Zingarelli 

If I'm not mistaken, we have a BP Meetup on the 1st in Lake Nona? Or is it someone else hosting a different event? Kelly - you seem to be integrated, can you weigh in? 

 Welcome to BP man! There's a meetup happening in Lake Nona next month on the 1st if you're interested in going (it'll be my first one). 

What's Core 4? 

Also if someone knows a great mortgage broker, please tag me so I get a notification when OP is answered, haha.

Nice post. Any reason why you believe it'll change? I know the market is starting to cool off here in central florida slightly, but I'm wondering if when we're in a buyers market, is that when more "deals" come up because people are more desperate to sell and ergo are more able to take a loss if they own enough equity or do some Sub2/Seller financing options?

I got interested AND bought my primary residence this summer unfortunately, but I can definitely tell stuff is starting to cool down and prices are going down a little bit.