All Forum Posts by: Deacon H.

I have a multi that is about 1 hour away from me that I self-manage. Tenants are on 1 year leases.

Things are pretty stable but i fear the nuisance call of  "I lost my keys". 

I have been searching for a better way to accommodate this situation and was hopeful to find some remotely controlled and programmable door lock. I would charge my tenants to change their combination should they give it out to someone and need to delete and set a new one. 

Issues with this:

All the remotely controlled locks I have seen require wifi so I would either need to pay for internet connection OR require my tenants to let my door lock onto their networks.  That doesn't seem like it would work. 

Things I've considered:

1. Get a non-wifi enabled door lock and just program 1 spare code just in case someone needs to be let in. The issue here is that I still need to drive there at some point to remove a code and add a new one. This buys me time but I still need to drive there. 

How does everyone else get around this? It seems like technology nowadays should be able to solve this one.

I think I found a better way to represent the detail.

Included below are more of the details short of giving every single line item for every single expense.

Here are the actuals since purchase. I've highlighted certain cells to show abnormalities and provided some reasoning below.

Here are the actuals shown at a monthly level.

And here are the actuals shown at a monthly level REMOVING the 1st year which had some high make ready costs that I don't believe I will need to incur again in the immediate future. (separating utilities, cosmetic repairs to the exterior etc).

Rent was raised for 2019 and is fully occupied on annual leases.

 Yes I have the details. Every expense. I was just trying to summarize a bit for brevity sake. 

With every property there are little nuances. Example - There was initial repair and make ready costs when she purchased it which affects the first year NOI.

In order for you to help evaluate this deal what should I provide? Upload a spreadsheet of the details or is there a better way? 

Oh. yes my numbers have an assumed 7% vacancy to be on the safer side. Should I go 10% for the sake of evaluation?

I took an average of several years of operating and repair expenses. On the high side 25k. Low side 19k. The average came out to 21k but I could increase that to 22 or 23 to be safe?

I have an opportunity to buy an off-market 3 family house. 

I was wondering if I could get some opinions on this deal. Perhaps I'm not thinking of something.

Market price is around 400k so I'm hoping to get this around the 380k or 385k range since there is no broker fee and we'd likely split the benefit. 

Rent is about 53.5k a year. 

Operating costs are about 21k a year. 

NOI = 32.5k

Cap Rate (assume 385k) = 8.4%

Financing:

I'm trying to find a commercial lender that will allow me to do a 20% or less but am only finding local ones that'll do 25% down. I'm going to keep looking.

If I'm able to find a 20% down, the mortgage will be around $1900 a month and I would cashflow ~850 a month.

Total invested would be the down payment (77k) plus closing costs (13k) = 90k.

That's a COC of 11%.

Is my math right? Is this a decent deal? 

I will be asking for owner financing but what should I target? 5% or 10% down with a 5% rate? 

Is there anything else I'm missing or should consider? 

 Haha. Already have one. I was thinking more of doing bathrooms, finishing the basement for more Sq footage and creating a better outdoor space around the pool. 

OK thanks for the help

I'm starting out looking to get into multi-families and larger apartment complexes. 

I have some cash which could get me into  some 2 or 3 families but if I had more cash I could get into some 10-15 unit apartment complexes.

I'll use nice round numbers because it's easier.

Let's say I have 100k cash.

I have the ugliest house on my street...and live on a very nice street and in a nice area.

Houses around me sell for 600k. 

I bought mine for 350k and put 50k into it when I purchased it. It's likely worth 475k now.

I'm toying with the idea of putting anywhere from 50k-100k into the property 

My target would be to get the house to an appraised value of 650k which would give me about 350k in equity

I would then take as much of that 350k as possible via an equity line and buy a larger apartment complex than I could otherwise afford with my 100k cash.

Is this a horrible idea? My assumption is with the larger apartment complex is that I could cashflow better than with a smaller multi-family and would be able to service my equity line debt. 

I guess the 2 options look like:

* 100k cash + equity line of 175k

* renovate my house and have 0 cash available for investment + equity line of 350k