All Forum Posts by: Craig Willard

Absolutely, we all look for that 40k+ in profit but in certain markets, those are hard to find. I didn't realize you were talking wholesale profit, it wasn't mentioned in your original post, my bad.

I am not speaking from experience but one thing I have thought about when looking at houses to flip.. Unless you plan on selling it yourself, don't forget about the 6% that goes to the agent. If you are working on a deal where you have less than 20k in profit, this could literally eat all of your profits.

@joelowens you are right. This property is at a prrmium. It is not distressed and therfore they are not willing to negotiate much. Your feedback is greatly appreciated!

The insurance was included in the expenses. I would not use property management here. On your property getting 11%, was it distresssed? Theisproperty was

Here is something I ran across….

1. (2) 4-plex townhouse in great shape side by side. Each unit has 2 bedrooms and 1.5 baths with garage in the basement. These are nice townhouses
2. Both properties need nothing at this time
3. Property tax 5300/yearly
4. Both properties were built in the 90s
5. Sellers are asking 498,000.
6. Income @ 625/unit fully rented = 5000/month

I am struggling with the numbers on this deal, its not looking good

Tax assessment is 480,000.

Lets just say we use the 480,000 numbers. I am told they will not come down much at all...

80K = 20% down

600/month = vacancy rate (not had a vacancy in years but I would rather plan for it)

435/month = taxes

230/month = repair fund

Utilities paid by tenants

expenses = 1465/month 400k @ 6% = 2398/month

5000 income / 3863 in expenses = 142/month/unit

_________ This doesn't look like a good buy at all …maybe I am missing something?? I do think the property is not renting for as much as it could, across the street is pulling 750/unit.

Thoughts?

If avoiding taxes is what you are getting at, an LLC will require you to pay an additional 15% employment tax. In order to get around that, get an LLC and request an S-Corp Status its a 2553 form. You must file it before the first two months and fifteen days of the beginning of the tax year in which the election is to take effect.

The allows your business to function as an LLC legally however be taxed like an S-Corp. Check SBA.GOV and your local tax laws… Hope this is helpful

Craig

Hello everyone, My name is Craig Willard. I reside in Central Kentucky, Go Wildcats!. While I have been involved in a few real purchases, they have been for me to personally live in. I have talked to family and friends about building my retirement in the Real Estate Business for years but never took the plunge.

I would like to start with a few flips to build a financial foundation. At that point I would like to purchase a few rental in order to keep a nice cash flow that I can continue to turn over. As a full time Director of IT for a hospital, I don't need the income to live day to day therefore my intentions are to reinvest all cash-flow back into the business.

So here I am, looking for knowledge as I start my path to retirement stability. I have read the ultimate beginners guide, the book of flipping houses, the book of estimating rehab costs and Rich Dad Poor Dad. I have listen to at least 20 pod casts and continue to, I downloaded all of them on my iPod and chose to listen to them over music in my commute. With Knowledge, I can increase my chances at luck!!

I looked at my first property recently, it was a homepath house. On the market for over 100 days. The price has dropped in half and still it will not sell. When I went to look at it, I was required to sign a health waver before entering. I took that as a good sign that this property has too many issues. Looks like I am down to 99 more houses to look at, 10 to offer and 1 to buy!

Look forward to meeting some people in the area and building lasting relationships.

Craig