All Forum Posts by: Eric Diem

@Michael Boyer It doesn't look like he is trying to change the number of units in the building it sounds like over time he would like to change 2 units from 1 bedroom units to two bedroom units in order to increase the units maximum rents from 750 to 900.

Of course I agree wholeheartedly that it may not be worth it to increase the total units in the building to more than four.

@Account Closed,

Welcome to BP! While my spreadsheet states that your Initial ROI would be more like 60% that takes into account that you are using 750 per month from the unit that you will be living in. However, it is that that raises your ROI by sacrificing the 750/month for the unit your living in also lowers your initial Cash outlay. Also remember that your ROI is based on the cash outlay not the cost of the property. That percentage also assumes that you will be able to get the seller to pay for the new roof. If you have to pay the 10K out of your pocket you are looking at an initial ROI of around 30%. Still not bad and your annual cashflow is just under 100/rented door at 99.06.

If after a year or two you refi out of your FHA loan to get rid of the residency clause you will still be at about 100 a door with 10% vacancy and 10% Property Management costs, and your ROI with the extra 10K out of pocket for the roof will increase about 12% @ refi.

Would it be possible for you to close on both properties in your pipeline? If so you don't have to pass up on this one if the numbers work for you.

Just my pennies

Thanks!

Eric D

@Ray Jimenez - As far as the feedback you were looking for in the OP I believe you have received more than enough.

My question to you is this: Why are you not marketing this to Flippers at your REIA? If I had this deal under contract here is what I would do.

I would head to any function where I know other investors converge to talk shop and during the Need/Want or any other time where I could bend the ear of the "Seasoned" Flippers in the room I would say "Hey guys I have a great deal under contract that has an ARV of around 125K based on recent comps, I am willing to let it go for 32K if anyone is interested. However, I would be more interested in staying involved in the process as I would like to build my track record. Here is my analysis of the deal."

Purchase Price: 32,000

Rehab Budget: 24,000

Holding Costs: 30% or 37,500.00

Potential profit: 31,500

Saying that you will either make around 7K on assignment after you let them talk you down to 30K for the purchase or you will get the attention/mentoring time of someone like @Jeff Rabinowitz or any of the other successful rehabbers here who have the experience doing what you want to be doing.

Instead of looking for Private Money this early in your career after most of the veterans here have all shared on the forums and in other arenas that they weren't able to successfully find private money until they were very open with their track record and most of them will tell you that instead of presenting a singular "solicitation" for private money they first gave the potential investor their 3" Ring Binder full of here's what I've done so far any questions book.

The only caveat I can see to the above would agree with the first piece of advice you were given. Give them an offer that while not being too good to be true; makes it difficult for them to pass up. 50/50 with preferred returns or 70/30 split their way. You have to remember you aren't just looking for one and done investors, you want ladies and gentlemen that will hand you their hard earned 5-6 figures and allow you to keep their money churning better than a dairy farm. 

While I only meant to leave my .02 it looks like I gave you the full nickle.

Thanks for listening!

@Jessica Sheppard

Welcome to Bigger Pockets. There is a lot of info here you should have no trouble learning about Buy & Hold. Be sure to check out anything from @Brandon Turner he tailors a lot of his content around buy & hold. There is also @Brie Schmidt from Chicago she also provides a great deal of quality content on Income investing.

Don't hesitate to let me know if you need anything.

Eric.

@Joe Richardson

Welcome to Bigger Pockets Hope you are able to find it as useful as I have.

Please don't hesitate to let me know if you need anything.

Eric.

Welcome @Mike Berkey!!!

Fellow Michigander and IT Pro here, looking around there are quite a few Multi-families available in your area as long as you know the neighborhoods and take action this shouldn't be a difficult goal to accomplish.

Best of luck.

Eric

Welcome to BP @Jennifer Williams!! Tons of information at your disposal here.

@MarkS39

Definitely enjoying the plethora of information available so far and I am sure it will only continue. Thanks for the kind words.

Eric D.

@Brandon Turner, @Dave Visaya,

Thanks guys will definitely use the advice.

@Philip E.

Thanks much, hows the D.C. Area treating you? My wife wants all of this to lead us to South Carolina in the next 3-5 years. Having traveled in the Blackstone VA and surrounding areas it seams like traveling the coast would be fun. Do you ever scope out any other markets around you or do you stay local?