All Forum Posts by: Dalton Ryba

Thank you all in advance. Here is the scenario:

Duplex, ~1800 sq foot total, built 1930s. New roof, 2 car garage with divider. Decent neighborhood.

Unit A: 2 bed 1 bath (partial finished basement with second bedroom), well cared for, no immediate updates needed. Central air. Has all appliances, working. Tenant is section 8, renting for ~450/month. According to tenant, has "absolutely no plans to move" and is "in good health". 

Unit B: 1 bed 1 bath with unfinished basement. No current tenant. Needs complete remodel including new windows, has window air only. 

After casual back and forth between our agent and theirs, it seems ~$85000 would take it. We have obtained estimates for complete upstairs remodel including paint, flooring, all new bathroom, windows, appliances, central air for $13,100.

Numbers:

85000 for duplex + ~1400 closing (after split 50/50 per agent recs), + 13,100 remodel = $99,500 total

25500 (down payment at 30%) + 13100 = ~38600 required up front

395.85 (P&I at 7%) + 180.36 (CapEx after remodel) + 222 (tax, insurance, vacancy monthly) = 798.21/month expenses

Anticipated rent: Unit A = ~450 (hoping for section 8 revaluation if become owners), Unit B (after remodel) ~600 = $1050/month

Final Numbers: ~250/month cash flow, 8% cash on cash, 3% cap rate

My questions:

1. Our small real estate company is just getting into this business and we are wanting a relatively low risk, modest reward property to get our feet wet. Although, in my opinion, 85 is just a tad high, it cash flows decent at this amount and serves an a good intro property. Thoughts?

2. How difficult is it to appeal for increased section 8 rent? My search so far has revealed mix results.

Again, thank you for your input!

D

Hello All,

Not new to the forum but first time poster. I have a few questions regarding real estate investing in Nebraska. Unable to find a lot of information regarding this region so I am hoping I can get a few bites, or at least some useful advice along the way. Let me first start by showing my appreciation in advance for the read and responses. 

I'll start from the beginning:

My brother and I are co-founders of an LLC (2 member), recently established with the intent to purchase buy and hold rental properties of all types, primarily single family and small multi-family homes as these are far more abundant in central Nebraska. We are in the process of analyzing properties and are eager to get the ball rolling. (I know family/friends do not always make the best business partners but in this case I am content with the situation, so this is where we are at)

Questions:

1. We have a family friend who is a real estate agent and has been assisting in the property hunt and showings, etc. That said, we are interested in potentially obtaining our own real estate license, for the usual reasons; MLS access, cut out the middle man etc. Can anyone provide insight on the process of obtaining licensing in Nebraska, maintaining the license, annual fees, need to actively broker etc. Is this worth the time and hassle?

2. Despite a relatively stagnant population, the demand for housing in the area seems to be relatively high at the moment, and market prices are unreasonable. A lot of the % rules we discuss on here rarely apply. There are a few properties that come and go, primarily duplex and triplex properties of not great quality in not great areas that fit the bill, otherwise the mainstay seems to be something like: 3 Bed 2 Bath home, 900-1200sq ft, built in 1930s, needs some work, 120-160k. Would rent ~$750-900/month. Question is, is it worth the time and effort to stick people with ~70% value offers or should we wait out this market trend? As I mentioned, we are eager, but as beginners we are also cognizant of the detriment of buying a bad first deal. 

3. Very interested to meet any investors in the area. We are eager to learn!

Again, we appreciate your time and comments.

Best,

D