All Forum Posts by: Cody Steck

Wow! That is great! @Nathan Emmert 

Thanks for the information! Yes, it is in Ogden and it is east of Washington but only by a couple of blocks.

I like the information you provided. It is good to have some 'insider information' from somebody that has been in that exact market. So, it looks like the rents are higher than they should be and the numbers for water and vacancy are too low. I also forgot PM but even with taking that out it does not provide a good cash flow number.

There is quite a few properties listed similar to this and I've wondered to myself -- "if those are such good numbers, why isn't anybody picking these up?" Now I can see why.

Thank you for the information, it is exactly what I was looking for. Looks like I need to continue to research the market and refine my numbers.  

I am a beginning investor looking at a potential property that is about 40 minutes from where I live. The numbers look great and I wonder if I am missing something. Let me know what YOU guys can see.

Duplex: 2 Bed 1 Bath on each side renting for $650/side. Rent is a little bit above median but property has just been fully updated (assuming this is a flip for the seller) Separately metered.

Asking price: $105k

Down Payment (20%): $21k

P&I: $438 @ 4.75%

Property tax: $55

Insurance: $50

City utilities (water, trash, sewer): $95  -- Gas/electric paid by tenant

Misc Maintenance/cap ex: ~$200 (obviously would get a more accurate number with due diligence)

Vacancy: @4% = ~$40/month

Rents = $1300 - 50% rule = $650 - P&I = $212 cash flow. This generates the desired $100/unit.

One thing that does concern me a little bit is the fact that this house was built in 1887. Hopefully, everything was updated accordingly and not just covered up. I would obviously look much more in depth to this if I were to pursue this deal.

Is it naive of me to think that my expenses might be closer to 35-40% of my rents? I am not going to push the numbers in order to make a deal, but just looking for input considering there is already a $200/month allowance calculated in and it is recently remolded. Or should I realistically expect the 50% rule due to the age of the property. 

Am I missing anything? Thanks!

I'm just a rookie but it doesn't seem like it should make much of a difference either way if I am correct. Other then if it were to affect your financing contingency in some way being that the purchase price would be lower if you went that route.

I'm pretty sure it will equal out the same way on the other side.

Are you talking about a seller giving you a credit as in basically writing you a check for that amount? If so, I don't really see the difference with paying cash or financing in that situation. But if you are referring to the seller's doing the repairs, I would rather have a price discount so you can take that 3k and make sure the repairs get done correctly through a trusted contractor of your own. The seller might only do a half decent job to try to save some money since they are selling anyway.

Wow! @Brian Gibbons your example about doing a JV option is incredible. Very creative and very smart! Both parties win -- I love it.

I agree with @Anthony Gayden The Millionaire Real Estate Investor is one of my favorite books and I am currently about half way through it on my third time around. 

@Evan Manship 

I am currently looking to land a job in the real estate industry so I can start networking with other professionals. 

I have also noticed the advantages to being a broker. And I think I would also like to pursue this. I have seen some disadvantages but I still think the good will outweigh the bad. 

@David Friedman I am getting better at recognizing a deal; I have a mentor who allows me to walk through properties and then estimate repairs, ARV, comps, etc and then he will tell me how accurate my numbers are. It has been an amazing help. I will keep looking for opportunities to learn the business.

Thanks!

I am a beginning investor looking to learn as much as possible. I have started attending my local REIA meetings and started meeting other investors. I want to learn as much as I can and learn to be an asset to other investors in order to build relationships, rapport, and my own network. One thing that has come to mind is bringing value to the table. 

When I think about bringing value to the table for potential partners, mentors, or networkers, I see three main things that are useful and people need/want. 

1. Money

2. Time

3. Ability

As I am just starting out, obviously money and ability are harder for me, but I do have lots of time.

Are there other things that you are always looking for in a new contact that you wish they had and could offer? I.e. property management experience, links to contractors, etc.