All Forum Posts by: Logan Turner

This is the equivalent to Nigerian prince email scams written in the same tone and with the same low ball requirements "must have a credit score above 400"

Originally posted by @Ayodeji Kuponiyi:

@Logan Turner I didn't get the trailing 12, I use the expenses on the OM and the broker confirmed the expenses were actuals (unless I decided to dig further, I just used those numbers) I checked rentometer and I can raise rents $50 but the current rents seem close to market. It's true that laundry is already a value added component. The neighborhood C class. Thanks for you input. I'll pass on this property. 

 I think ithats a good call. Commercial is frothy right now, but I would still be analyzing deals like you are, get it down and get really good at it. Have brokers keep sending you deals. Just use 40-50 percent "rule" for expenses depending on the area, tenant type and property condition, see if they make sense. 

Btw, are you trying to syndicate, owner carry back or coming with 25 down of cash? 

awesome thread, that actually has some substance to it. That is lacking the most here on these forums, substance; too many vague posts and advice. 

Best of luck in 2016

many different options, depends entirely on your circumstances at the time. Do you need to cash out? then try seller financing, 1031 if your trading up or changing asset classes (residential to commercial or smaller SFR to larger one)

10 years from now 250k may be a good deal for an investor.. depends on inflation, appreciation and location. 

1. if you sell you will get hit with the tax liability the year you sell it.

2. 1031 to defer taxes

3. seller financing to give you cash flow and spread out tax liability (depreciation and capital gains taxes)

4. don't sell. don't ever sell ;)

if you get a solid deal, you should be able to get 100 percent financed. Might have to come in with closing costs yourself.

For example: say the sell price is 60k. 20 k rehab and ARV of 135k. You can get that 100 percent financed all day. On the other hand, sell price is 90k, 20k rehab and ARV is 130, you will have to bring a little thunder to the game.

Hope that makes sense... also, 100 percent financing is at least 2 points... 

Best of luck

check out some youtube videos as well. To get a basic education.. commercial real estate for dummies.  

David Lindal is great (from many reviewers)

How did you arrive at the specifics of you expenses? Did you get a trailing 12 or 24 from the owner/broker? 

A quicker way to see if it works, is to subtract 40-50% of Gross income. You can spend lots of time analyzing all of the numbers, or just do a quick 45-50% depending on quality  of unit and location and subtracting from Gross rental income to arrive and if it is a good deal or not. For example: i question your vacancy rate, your maintenance and repairs and your management fee (unless your including on site payroll into that).  But all in all you are close to the 50%, so i would just use that number.

Secondly, might be tough to get a 30 year loan. Might be 20-25 years, also 4% is great. Might be a tad higher.

What you should do is analyze the deal in the best case scenario (that is still possible)

The worst case scenario, and then assume it will probably be somewhere in the middle. 

I think you are looking at things a little too optimistic in this deal. You should be looking for value add opportunities. Can you increase rent? Why or why not? You can't decrease expenses because tenant already pays electric and gas. Its possible you could divert the water bill to them as well. You've already done the value add of laundry, and you can not get any lower vacancy (5%) is best case scenario in my opinion. 

I would say no go. Good to best case scenario only 7.57% cap... i'd pass.  

Also share the class and neighborhood class of this asset, it makes some differences

Hey, I grew up in Roseville Ca, and now live in Texas for very similar reasons. My job pays the same here as it does there, so it allows me to save more to which I can invest. If that is the case then maybe it would be a good move for you. Roseville area is very high priced right now, more than in 2007. I would not invest in this current market. So moving away for 3-4 years, if you can earn more money (relatively speaking) and invest locally, you could wait for the next downturn. Go in cash heavy and buy some great California real estate. I do like the quote: live where you want and invest where it makes sense. But also: do what others won't do so you can live like others can't. Maybe moving away for a few years would accelerate your investments and passive income. Really depends on your personal situation.

What was the time frame? Purchase price? Rehab cost, holding costs? And now ARV? Great job, btw. The house looks modern, clean and 100 times better now!

@Lydia S.

I've used zillow, trulia and realtor and searched under sold homes to view comps that way, but i thought maybe the MLS would provide better data or something not seen on those sites. So far, it has not.

Any other sites you use for comps, that have been reliable?