All Forum Posts by: Daniel Suarez

Hello, 

I have a property in Baltimore that I'm renting. The lease ends at the end of May and I'm trying to decide if I should I sell and reinvest or cashout refi. 

Some context; I bought the house 4 years ago and owe about $90k, the current value is about $180 after some repairs. If I sell, I could take the profits (about $80k after fees) and reinvest in maybe 2 $200k fixer-upper places in a better neighborhood that might need some love. Of course, I would need to add a bit more in the repairs mostly cosmetic. Each house would rent for a bit over $2k. 

The other option is keeping the house, cash out refi, and use that money to buy 1 house in a better neighborhood. That house would rent for about $2k and this would rent for about $1800 max. The problem I'm having is that this house is in a C class neighborhood, my current tenant is extremely demanding and a pain, and keeps on complaining about rats in the alley behind the house (nothing I can do) I worry keeping the house will attract not great tenants, and also the problem that for a reason, the houses I get appraised always come back lower then the price, I have a haunch that my lender will appraise the house at about $165k with 75% cash out i would only get about $35k out to buy another house.

Any suggestion would be greatly appreaciated. 

Yes, i think there's still a bunch of opportunities. The prices points have moved though. Before you got something for $100k and the arv was $150k. Now they're closer to $130k and the ARV is $180k

Hi All, 

I have some family members who are not residents, American citizens nor leave in the US and are interested in partnering to buy a multi-family with me. Does anyone have any experience with this? A couple of follow-up questions. 

• I know we can form an LLC if they get a TIN, any ideas on how foreign persons can get a TIN?

• Would there be any problems creating an LLC this way?

• Are tax implications any different than for American citizens?

Thanks so much in advance. 

@Erik W. Exactly my thoughts. I would rather put the money in the stock market or stick to SFH.

@Juan Carlos Gastelum Exactly what I'm talking about! monthly casfhlow of $1256 for a 1m investment sounds ridiculous. 

Thanks so much Arn, that is really good to know. I haven't heard of agency loans before, something to look at. I'll definitely do some research on loan guarantors as well. 

Thanks so much Brian! I haven't paid attention to IRR before. I was only looking at cash on cash and cap rate numbers. I'll definitely pay more attention to it.

Interesting, so a lot of people are buying 5% cap rates with the hope that it might be a 4% cap rate in the future?

I only have one multi family currently in C area Oklahoma that cap rates about 11%. I thought most commercial loans were similar (mine was 25 down for 25 years at 5.5%) I guess the better the area the better the interest rate you get, also maybe less vacancy?

Would you mind sharing numbers of a recent deal you made and how that's doing so far? 

Thanks so much!

I'm looking at a bunch of multi-families in different cities, and a lot of them are 4 or 5% cap rate in B areas that sell really fast. 

My point is, I understand that you get lower cap rate areas at A or B areas, but with such low cap rates you're certainly having a negative cashflow at 5% rate with 25% down at 25 years. 

Would love to hear from people who bought similar cap rate properties, what your strategy was to buy such low cap rate properties and how it worked out. 

Pretty cool! do you have any income estimates?  Also, how much are planning to pay for property management. 

@Janelle Dekdebrun, piggy backing on this, I bought a Ryan home and leases it back to them. Pretty good experience.

Took a couple of months to receive the first rent, but it was always on time. The good thing is the appreciation. I’m on my second year. The lease with RH is over and I’m renting to private lender for a little less than what Ryan homes paid. Overall cashflow a are ok, but you get a better appreciation once all of the other homes are sold.