All Forum Posts by: Darren Crawford

Any more details ? What area  ? 

Hi BP family

Quick question what is converting better for you Voicemail Drops or Text Message Marketing ????

-using List Source and Propstream to pull list 

- using batch skip tracing for the phone numbers 

- slybroadcast for the voicemail drops 

but I am debating on trying texting message marketing just want to know your guys experience on TXT blast ?

@Zach Griffin With the numbers we are projecting the ARV should come in around $1.5M , but yes I should of added the ARV my apologies. Also yes we do have a lender I was just speaking today about the matter cause they seem to be one out of a small few that offers a 30 year amort loans but the they come in at 75% LTV and little high interest rate in addition I do have two other lenders on stand by that just do the typical 20 yr Amort and I already ran the numbers for 20 years and the property would still cash flow.

@Brandon Kamm your absolutely right when I wrote the original post I was merely going off the sellers word about the property tax but after further research we discovered its an additional  $4,200 due every year for taxes for the county so were adjusting our numbers now. First time we've been in a market with two sets of taxes but were adjusting.

@Igor Avratiner no question is dumb thanks for asking we come from the San Diego,CA market where properties can really appreciate now some parts of memphis properties do appreciate at a good rate ,but our investing approach is never really based of future appreciation more so does the property cash flow and does the deal make sense can we get a good ROI ?future appreciate is more like icing on the cake for us.

@Jack Inman Yes most units have a 1 year lease with an option to renew but some are on month to month no more then 20%. Usually lower rents do have higher eviction rates to help limit some of that risk  we plan to target older section 8 tenant they seem to be more stable when it comes to lower rents.

@William Coet Yes we have...is there any particular issue you care to point out ? 

@Peter Nikic thanks for checking the deal out yess all of our expenses are expected to be fixed and any overage I plan to roll over to the tenants to make them equally responsible,now the break down for those expenses (utilities ext) I just calculated in the 50% rule for now but once I have a better understand of those numbers I will share them with you guys still in the due diligence stages,but I do agree with you we won't spend to much money on the inspection phase just yet on the plus side the seller did state the the AC and broiler were recently upgraded so that's a life saver as for the work I don't mind hard work as long as the numbers make sense and pays off. I am drafting up my LOI now PM your email and I'll send you a copy of it.

@Michael Ealy what deal analyzer software are you using ? according to the seller these numbers are accurate but still waiting for the Rent leger or rent roll to verify from seller and normally I put each unit at $10k for rehabs but the individual units are in pretty good shape so I adjusted my numbers a bit maybe I could be more conservative and estimate at $330k but I am still in the inspection period stage,but I did come to the same conclusion that the deal is worth pursuing...I'll keep you updated on the progress but if all the numbers are right how would you structure this deal ??  

@Brian Garrett yeah I agree I wanted to make my offer appear more aggressive with a faster inspection period but truth  be told he is going to be using a 1031 tax deferred exchange account  and those deals take some time so I figured I would be able to wiggle some more time out for inspection if I really needed it. but I have an amazing apartment manager and a really good experienced contractor that should be able to get everything done in 15 days usually I do ask for longer ....  

@Greg Dickerson Thanks on my next list I'll remove the equity filter and see how that list holds up. 

Hi Bigger Pockets Family ….

So I wanted to share a deal I’m currently working on and hear everyone’s thoughts ,but before I do I’ll tell you how I found the deal.

Step.1

I located a market I wanted to invest in which happened to be Memphis ,TN due to a number of reasons then I narrowed down to about 4 zip codes I wanted to invest in.

Step.2

I made a list using Propstream (No I am not an affiliate just like the service )

Search Criteria

-Targeted 5+ unit Property owners

-Property Owners that owned for 10+ years or longer

-That had at least 50% equity

Step .3

Once I compiled my list I came up with around 169 property owners that met my basic criteria

Using Batch Skip Tracking I tracked down around 60% of the numbers to these potential sellers and started to cold call each one (NO RINGLESS VOICEMAILS ) by the third phone call I met a gentleman named Matt who stated he is a builder owned a number of properties all over memphis and two other markets and was interested in selling a 33 Unit apartment complex in Memphis TN.

Step 4 (Build Report )

After Speaking with Matt I discovered he is willing to sell a 33 unit complex in the Berclair 38108 area of Memphis using a 1031 Tax Deferred exchange account now the seller isn't the most motivated seller he is literally holding on to the property for a tax write off but would be willing to sell to use the capital to buy another larger property. He stated he bought the property 10 years ago for around $730k and would only entertain an offer of $800K or higher stated the building is 90% occupied and all rents are between $450-$500 also stated the rent could increase 20-30% after repairs are made. He said he hasn't been to the property in about 7 years but it has been well maintained through his property management team.

:: THE BREAK DOWN :::

(Berclair Area of Memphis TN 38108 which means it is in a C- area )

Asking Price $800K for 33 units complex

Repairs Estimate $200k

$1,000,000 divided by 33= $30,303 Cost per door

33 units Break down

Consisting of 50 % of the units 2/1 and the rest 1/1 and 3/2

Rented at $450 Per Month

33 units 90% occuppied =29 units

29 units at $450 per month = $13,050

Round all rents up to $450 per month each

Vacancy: 10%

Gross Annual Income $156,600

$156,600 (annual ) divide by 2 (50% Rule for expenses )= $78,300

NOI = $78,300

Cap Rate = 7.8% Cap Rate

Annual Property Tax = $3,100

Annual Insurance = $5,000

Management 10% = $1,300 per month

DSCR = 1.6

Step 5 ( Making the Offer )

I feel like $800k could be a little high so I plan to make two offers to see which would be more appealing to the seller

Offer 1 All Cash Offer of $770k (15 day inspection period )

Offer 2 Offer $800k but I would ask the seller to carry a second position loan for $300k at 6% interest amortized for 12 months (7 day inspection period)

My main strategy is the BRRR approach. I will use Hard Money at 9% amortized for 12 months. Within that time I plan to renovate the property, increase rents, get it to 100% occupancy then refinance at 5% amortized for 30 years.

What do you guys think ?