All Forum Posts by: Robert Freeborn

@Robert Schumacher Great thoughts here.

At current rent, it doesn't cash flow with 100% financing, at least not conventionally.  Would have to do owner financing to make that work at a low interest. 

My current capital is tied up in 3 other deals.  One is scheduled to close next month.  The second is wrapping up right now and should be listed by the end of the month (just had a tile issue that set us back a week.) My third deal is a limited partnership on another flip that should be listed by the end of the month as well. So I have capital, just no access right now, which is why I'm trying to find a way to make this work without.

Once I get the property my plan would be to renovate as the units turn (non-renewing as needed).  I would spend about 10k each unit.  Rouged vinyl plank floors for longevity, appliance updates, limited drywall and paint repair, etc.  I'm a GC so I can do the work myself to save on costs. 

I would also look at reducing the expenses to increase the NOI. Based on the average rents and looking at the last units that sold, all at around a 5.5 cap, I could increase rents to 1200-1300 easily. I think I can do 1400, but will be checking with local property management on that on Tuesday. If I only increased the rent I could sell it at a 6 cap for 1,759,000. That would be about a 300-350k profit once rehab, loan costs, and selling costs clear.

If I hold it, using a lender that allows for interest only rental loans, I'd cash flow about 3k a month.  Using a conventional loan, that would drop to about 1500.  That is assuming I buy at listing price. 

There is no rent control in the area.

@Andrew Smith depends on what you mean by Seattle. If you’re a little further up north we have some great ones in Bellingham.

@Charles Ngansop

Some great thoughts here.

How do I know it’s a good deal for the area? Because I’ve been looking at multi family in my area for over a year. I’ve run the comps and crunched the numbers.

What’s my exit plan? Either long term hold and cash flow or rehab as each unit turns over and increase to market rent and resell at a 6 cap. (Market rent is 1400 per unit. Selling at a 6 cap at the current expenses comes out to 1.9m. 7 cap would be 1.66m. )

The properties are on adjacent lots, but conjoined together and sold as one. So you raise an interesting idea on if I could finance each individually.

I would respond more to your post, but I’m typing on the app and it isn’t showing me the rest of your post, so I’ve had to go from memory )

@Jordan Radke

Bellingham Real Estate Investor's Meetup

Thursday, November 14, 2019

6:00 PM

4164 Meridian St

Bellingham, WA 98226

HomeSmart office on the ground floor, back of the building.

@Jordan Radke

Hi guys! I would love to join you, but we just changed our Whatcom county meetup to the 14th too. We usually have a good turn out, so you’re more than welcome to join us up here. It’s the Bellingham Real Estate Investors group on Meetup. Feel free to message me for directions as well.

@Anthony Dooley

Ooooh! Master lease is a great idea!

@Parker Eberhard

It definitely has my attention!

@Anthony Dooley

Great advice. I was thinking something similar. I see some large upsides to the rent, so I think it’s possible.

I can’t edit it on the app, so quick clarification. List price is 1,250,000. Just in case it was confusing.

I don’t have available capital right now, but I really want to buy two 4-piexes (one transaction) in my area. I’d love any advice or strategies that can be offered.

List price: 1.250

Sf 8,792

Tax 8052

Gross scheduled income 86400

Insurance 1416

Water/sewer/garbage 2004

Electric 6912

Other 876

Total expenses 19260

Net operating income 67140

(These numbers look kinda pro forma to me)

Units are 2bed 1 bath 1025 sf

Central, coin operated laundry.

All units are rented for 900.

According to rentometer, average rent for would be 1400 for 2 bed, 1600 for 3 bed. (Will confirm that with property management on Tuesday)

According to the assessor, the last loa out on this place was in 2005 for 201,100. I imagine that it might be paid off by now.

I realize that many of you would say don’t do it, but for my area, this is a good deal.

My first thought is to try an owner financing situation, but I don’t have any cash right now for a down payment. This leaves me unsure of how to proceed.

C’mon BP, don’t disappoint. Give me hour best ideas for this one!