All Forum Posts by: Curtis Rouse Jr

@Terrance Clark My question would be why would you want to pay this size of a deal off? Why not just re-fi out and keep safely leveraging as much as possible and you would still be cash flowing (if purchased/managed correctly). I know this comes down to your specific goals/stragety, just wanted to get your thoughts.

@Evan Anderson Welcome to BP! At this stage of the game for you, I would focus on banking as much money as possible and absorbing as much information as you can on real estate. Start networking with other investors and see how you can assist them and learn the ropes so that when it's time to jump in you will be ready.

With me personally owning apartments, I would recommend owning as many doors as possible because the economies of scale plays to your advantage. If you are serious about investing and building a great income producing business, this far exceeds a social life early on because you will be able to do and go where you want when you are older. My mentor always tells me, sacrifice now and reap the rewards in due time. Best of luck and set those goals high!

@Jacob Whitney Welcome to BP! Like the others have mentioned, sounds like you are on the right track and I would mention to look at as many deals as possble that meet your required returns (me personally I look for a 10% COC) and stick with those numbers. Owning apartments and currently in the process of doing my own value add to increase the rents for valuation purposes, I would recommend to do a very detailed due diligence walk through of the property with at least 3 contractors (if you are unsure yourself) to get a good scope. That's the last thing you want to do when you start purchasing these larger properties is over extending yourself and going way over budget.

I've also built a financial model that I help other investors analyze property (especially the larger apartments), so if you ever have any questions or need help don't hesitate to reach out. The BP calculators are a great tool as well and what I first started using. I've posted a case study of the model on my website below. Best of Luck and start looking at some deals!

@Chris Maudlin Welcome to BP! So in regards to locating MFR properties, I would get on loopnet (most deals on here are not deals at all FYI) and start looking at deals where you might be interested and analyze them to get a feel for the numbers and required ROI's that you are looking for. I always call the broker, just to establish the relationship and let them know my buying criteria and stay in contact. You will come to find out that the best deals are usually built from relationships, not necessarily from listed deals to the market. The BP calculators are a great start for analyzing deals and I have also built my own financial model I help investors analyze deals (have an example on my website below). Best of luck and let me know if you need anything else!

@Ajaya A. I would go and buy an apartment building in the range of $4mm - $6mm based on a 75% LTV. Depending on your goals and aspirations is dependant on answering this questions as well. For me personally, I want to get as much bank debt (leverage) as possible to control an asset that is cashflowing from day 1 and just as important having a truthworthy team in place to manage the asset. With compressing cap rates in this hot market, I would be very careful not to purchase something just to purchase because you have the money. I aim for at minimum 10% ROI on my investments with a possibility in 3 - 5 years to double (these are mostly value add opportunities). If you ever need help analyzing deals, I've built a financial model that I help investors analyze these larger apartment deals. The BP calculators are great as well and where I started. Best of luck and let me know if I can be of any assistance!

@Derek Gibbs Congrats on writing up your first purchase offer on a MFR! So this varies from state to state and sometimes by county, but I know here in Ga where all my portfolio is located, there is no set limit on the amount you can increase the rents by. A good rule of thumb to be safe is to wait until their current lease expires and then implement your rent increase to whatever you want (of course justifiable according to your specific market rents). I'm currently in the process of implementing rent increases at one of my complexes and they are relatively $150 below market, so I'm doing $50 per year that will single handedly increase the property valuation by $320k over the next 3 years ($106k yearly). That's one of the great benefits of MFR's and I'm glad to see other investors like yourself capitalizing on this great opportunity we have with real estate. Best of luck closing this deal and let me know if I can help out with anything else!

@Earnest Mallard I would recommend starting analyzing as many deals as possibly (at least 75 - 100) that would give you a vantage point of where it makes sense to invest that yield the best returns and how much money you will need. Me personally, I focus on apartment complexes because you get economies of scale and more leverage to bring on investors vs a smaller MFR. It all comes down to "Your" specific goals and where you would like to be in the next 5, 10 or 20 years. I hope this helps and if you need help analyzing any deals I'm more than welcome to help out as I've built a financial model. The BP calculators are great as well and where I first started. Best of luck!

@Kevin Melson The BP calculator are a good start as recommended by others. I'm in the MFR space and I've built my own financial model to analyze larger apartment complexes and help other investors as well. There is a case study on my website that outlines what it looks like, so let me know if I can be of any assistance. Best of Luck!

@Sam T. Welcome to BP! I'm in Lawrenceville as well doing buy and hold, mainly focusing on apartments. All of my properties are in Macon, Ga but would love to help you out along the way or meet up with you being so close. Reading, podcast, networking and etc are great, but the real learning comes from getting out and experiencing the day to day operations and looking at as many properties as possible. I've built a financial model I help other investors analyze deals (the BP calculators are great as well), so if you ever need help let me know. Best of luck!

@Colleen Fiumara A rule of thumb I use is based on a 30% return based on the total cost per unit. For example, If I'm putting $5k into 1 unit, I plan on increasing the rents by $140 to return the capital I put into the unit. This ultimately comes down to desired returns and if the area will support the rent increase. I have implemented this strategy with my apartments with no problem capitalizing. If it doesn't make sense to spend the money without returning your capital, then why spend the money. I hope this makes sense and best of luck to you and your client!