All Forum Posts by: Don Johnston

@Sarah D.  Did you get any response to your questions?

@Tim Hall  Thank you

@Johnny Diamantas  I was actually window shopping.  But I am looking to take that first LEAP to my first investment deal.  I have been looking in Tallahassee but working with agents who aren't familiar with RE investors takes too much time and too long to get information and then only get half of it.  I am also looking at Tampa so I will see what city wins. :-)

I had good success with theRTAstore  online.  Solid wood and plywood.  I purchased them assembled and shipped (didn't trust the contractor to put them together).  Installed fine.  This was an Indianapolis rehab.

I have not had much of a good experience with any real estate agent I have had to use or be in contact with.  @Laurie Williamson and @Daria B. add me to your club of frustrated real estate ad viewers.  I have found it no different here on BP in the Market Place...maybe even worse.  Barely a picture with words touting a "Great Deal for Investors" but absolutely no numbers for us to run on the calculators on this site.  And what I have seen when browsing through a lot of the posts, they don't have the decency to respond to any questions.

As far as the real estate agents are concerned, most have no clue how to market an investment property so don't know what we mean by financials and they are too lazy to go out and take good pictures and post them.  One point in their defense, they would have to get the renter's approval to take photos and most won't allow it because it would be proof of how they are trashing the place.

Those who post in the Market Place here have no excuse.  Totally inexcusable when you post a property with a thumbnail picture, asking price and swear it will cash flow like the golden goose but when asked to provide more information, they just come back with "What other information would you like?"  In my opinion, best to keep their names in a spreadsheet of people NOT to do business with.

So...can you tell you touched on one of my BIG pet peeves?

P.S.  Just today, I looked at someone's post in the Market Place that had a very brief but honest description and a link to a host of great inside / outside pictures.  I left a post commending him on the pictures...the kind any rehabber would love to see on any property for sale.

@Luke JeanLouis Welcome to BP.  Be sure to read all the freebie books offered here on the site.  They are good.  I lived in Valrico for 12 years...left in 2005.  I, too, am looking at Tampa Bay area to invest in multi-family.  Glad to hear you "got your life back" and are only working 40 hrs a week.

@Johnny Diamantas  Finally, someone who knows how to take pictures of property.  Great job!  I would assume that the code enforcement lien was the 1/1 over the garage.

@Candace Berry , @Cindy Szponder Thank you. Regarding occupancy limit, Tallahassee has similar laws but are applicable only to SFR in certain zones. The laws do not apply to properties zoned for multi-family.

I am looking at a tri-plex rented to students - typically 20, 21 and up years old.

Asking $259,000. ARV about $300,000. Each is 4 bedroom, 3 bath. Includes Frig, stove, dishwasher, washer and dryer. All electric (no gas). Heat and A/C. Asphalt parking lot. Monthly income $3250. Here's the kicker. The building is only 20 years old...but EVERYTHING else is also 20 years old.

My educated guess/calculations is $30,000 in repairs; $40,000 if I do some upgrades.  Nothing NEEDS replacing, repairing NOW.  Units are fully rented with one unit's lease is up July of this year.  The other 2 are up July of 2017.

When I run the numbers through the calculator I get $674 cash flow, 9.59 CoC ROI and 8.8 purchase cap rate because the assumption by the calculator is I will be spending the $30K - $40K before leasing.

Other assumptions are 5% vacancy (even though they really haven't had any vacancies so this goes towards turnovers); 5% repairs and maintenance because of the initial reserve (more in a bit); 10% cap ex; $200/mo insurance (maybe should be a bit more); actual taxes and 10% property maintenance.  Just thought of the parking...need to adjust maintenance for re-seal and stripe every 5 years.

My desire is to purchase with 20% down at 5% financing and have $15,000 to $20,000 in reserves right off to cover immediate needs like new roof (but doesn't leak yet), 2 A/C's (third one is 5 years old), and "rehabbing" the 1 unit this year when the lease is up.  Rehabbing would include floors, paint, possible/probable replace of appliances and washer/dryer, water heater.  A/C's and air handler/heater need to be assessed as to expected life expectancy as well as the roof.  I would fly/drive out and do much of the inside repairs myself.  Too much Scottish blood and too little trust in others' work that I know I can do.

Rents real close to the University run $300 - $450 a bedroom.  This one is not even at $300 per bed.  Renewed, they could command at least $325 (they are 2 miles from campus).

There is one issue that could break this deal for me but it will be left unsaid.  I don't want the focus on it :-)  Just suffice it to say my eyes are open...but I have gotten a little excited about this project.

So tons of verbiage and a lot of numbers.  How does this look to you who are seasoned investors?

Why mess with the crappy windows.  Should put all new windows as well as tile throughout.  $32K doesn't sound like enough to do a decent job.