All Forum Posts by: Daniel Holtz

@Stephanie Medellin Yes, thank you for your input, I am of the same mind with you.  Also, I have been finding that myself with some of the rentals and the crazy prices for something that is retail that needs work as well.  I am hoping to find something here.  

@Scott FRy The property has 1 2 bed 1 bath and then 3 1 bedroom 1 bath apts in it.  There are many things that need to be done mechanics wise.  Roof is alright for now, but it needs many of the other major updates like siding, multiple heating units, pex piping throughout and many other areas.  I also agree with you with putting in materials that would last through multiple tenets.  

@John Casmon I was actually asking the real estate agent that I was going through the house with. Much of the ARV is determined by other comps in our area as opposed to cashflow for the asset itself. The market is currently pretty thin as far as deals that are available that are not in need of repair after aquisition.

@Aqil Dharamsey Yes, thank you for your input for sure.  I am thinking the same thing.  I still look at everything after the fact and typically most all if not all your Cap Ex is completed after the rehab is done.  

@Luke Grogan Yes, I go after cashflow myself in my investing career right now.  I will make the switch at some point to do equity plays or a mix of both, but right now, cashflow does help considerably.  

@Luke Groganundefined Those are mostly what I look for in my area.  We have more of a cashflow market overall rather than an appreciation market.  You do have to vet the area as much as the deal, because there are many pockets in Rochester and the wrong area can really skew your numbers on the repairs or cap ex side, because people would just not take care of your properties.  That can happen really anywhere, but the area does play a role here.  

@Darren Budahn I live in Rochester NY or the rust belt.  We have great cashflowing properties in many areas, but don't have a ton of equity all the time.  There are many other properties on the market, but right now, the market is very strong from what I have been seeing and the properties on the market right now are listed at retail value and still need work.  Not quite as much as the one listed above, but most of the properties here still need much work overall to get them up and running.  

Hello Everyone,

I am looking at a possible deal that is a 4 unit property. The average gross rents would be around $2100/month comfortably. If I can purchase it for about $20K, it would need about $50K overall to bring it up to speed. It may be slightly over improving it, because the ARV is around $70K. I am still considering the deal, because the cash-flow on the back end would be nice and I can refi and pull much of the money for the rehab overall back out of it. After this deal is complete, I would have a property that the cap ex would be low for many years to come and I may be able to 1031 or something along those lines into something larger. Just looking for some overall input as I really think this is a coin toss depending on your perspective.

Thanks,

Daniel

Welcome to BP.  You will find there are many useful tips and tricks on the website.  I would also suggest listening to the podcasts as they are very well put together and have a lot of great information and concepts there.  

Hello Eric,

Start reaching out to your local banks in your area.  Typically regional banks and other credit unions.  Put a package together that focuses more on the numbers and explaining why this is a good deal from the banks perspective.  Even though you don't have a W2, they may make an exception considering you are coming to the banks prepared, which is typically more than most people do when going to a bank.  Other things to think about is if this path doesn't work, you can also do a refi with B2R finance which looks at the numbers of the property more than at your specific W2 income.  

I hope this helps out, have a great rest of your day.  

Hello Vincent,

It will depend on your area and what type of deals that you are looking at.  Typically the numbers that go into it will include 10% vacancy, 10% cap ex, 10% repairs, and 10% management fees.  Make sure you are doing all of these numbers as they are important in the bigger picture.  If you are handling things like the management of the properties, you will still want to include this in your calculation because it will make your numbers more realistic if you ever go to sell and are trying to market to a buyer/investor.