All Forum Posts by: Bryan M.

Really? No opinions or insight?

Hi Guys,

I havent posted in awhile so it is nice to be back. Anyway I am currently analyzing a property I am interested in and it looks attractive at the right price. It is a 12 unit mixed building with 9 unit rental apartments and 3 units commercial space. The property is in good condition and is located in the center of a large town.
The seller is looking for 650k but may be negotiable and possible willing to owner finance. The numbers are below.

monthly income 8,400 at 100% occupancy

monthly expenses 2,200 including taxes, insurance, water and sewer.

I have read Mike Rossi's book and like his approach to expenses being 50% of gross rents when analyzing a property. What do you guys think just looking at the general numbers I included above? I have a number in mind that would work for me and it is much lower than asking price. Any thoughts?

Looks like the deal is not going to happen. I met with the seller 2 weeks ago and gave him an offer for 145,000. He seemed to consider it when I was talking to him but the next day he said he was uninterested in my conservative offer. I think my offer was pretty fair for both of us. I am disappointed because the house was in good condition and was located close to my other rental property and would have worked out well for me at my offer price but wasnt able to get it done. I cant overpay in this market and there are other multis out there. I will keep looking for a better deal. Thanks for everyones help with this deal, too bad it didnt go through.

Just an updated in case anyone was wondering what the story is.

I talked to the gas company yesterday and they said the previous tenant took the gas out of his name and the unit was listed as vacant but was not turned off. The new tenant will be responsible for the charges he has incurred since he moved in, case closed.

I own a 3 family apartment building that has natural gas for heat. My third floor apt was occupied when I bought the house but the tenant moved and I had to do some major rehab. When I began rehab the heat was still working so I though it was from the prior tenant and would be shut off soon and then I would put the heat in my name for the time I was working in the unit, as I did with the electric. The rehab took me 2 months and the heat continued to work, the gas was still on. I called the gas company to see whos name the gas was in and they told me the apt was listed as vacant and was not turned on? this was a month ago, shortly after this I got a tenant for the unit, I told him he would have to change the electric and gas over to his name. I took the electric out of my name but did not do anything about the gas, I figured he would open an account for the apt in his name. I saw him yesterday and he said he had not changed the electric or gas and to send him the bill. I told him he was supposed to do it when he moved in and that this is unacceptable, he has to change over utilities immediately. I am not concerned about electric because the account is already out of my name but I dont know what to do about the gas? There are 3 meters in the basement. I am scared that there may be a cross meter issue that would be a huge problem. How else would the gas continue to work if the gas company is under the impression that the unit is vacant? What should I do now? How liable am I?

Ok, here is where I am at with this deal. I am interested in this property due to location, I have another right down the street so I would like to have most of my properties in the same area. Also there are many pros about this deal, there is a new hospital accross the street and another one that has a medical school program 1/4 miles down the street. That being said i am motivated to close this deal, everyone wants to build thier business but it has to be at the right price, that is why I walked the first time but resumed negotiations when I saw the seller had reduced his asking price and still had no takers.

I sent him an email last week with an offer price of 150, owner finance. At that price the numbers work out and that is taking into consideration variable costs as well as vacancies. I will be doing the property management. 150 would be the highest I would pay for the deal now and will start at 145, heres a look at the numbers assuming we aggree to 150.

150,000 with 14,000 cash down
owner finance 136,000@6%

Payment $815

Gross rents 2300
NOI 1150
-815= 335 cash flow

150 would be the absolute top for this deal but I will try to work out 145,000 or possibly a lease option. I am still looking at that scenario.

There are other properties in the are so if this deal does not work out I will look at others but I am looking for owner financing so I have to be willing to compromise alittle.

Hi everyone, I have a question about forming an LLC.

I live and work in Ma and have one rental property in MA, I plan on adding to and building my rental property business in Ma also. Ma state LLC filing fees are $520 and RI are $150. Could I file in RI and run my bisiness in MA? I live close to the RI boarder so I could get to a post office for a PO box fairly easily. Also is an LLC the way to go for a rental property business? I would like to get business financing at some point. Thanks for the help.

ok so I sent an offer to the seller today and reduced my offer pirce by 5k. Offer is as follows.

150,000 purchase price
14,000 cash down at close
136,000 seller finance@ 6%

I recieved an email back from the seller today and he seemed interested in the offer by said the problem is he has a 64,000 mortgage on the property at 8% that he would have to pay off before owner finance or I could assume.

Anyone have any advice on how I can proceed? I dont want to take out conventional financing for this deal. I was thinking of assuming the loan and then send him the difference after I make payment every month.

Sorry for all of the posts but I have alot of questions and find all the responses very helpful. I am looking to expand my rental property business and add cash flow so I am being cautious of my next deal to make sure it is a good one. Thanks alot everyone.

any other thoughts guys? I would like to put together a proposal this week and see if I can get this prop under contract. I know the buyer was willing to owner finance interest only until the buyer could secure a conventional loan. I would like to work a deal to have the seller owner finance the deal at 6% for the life of the loan. What do you guys think, could I suggest if he wants a lump sum to take out a mortgage and wrap?

Sorry about all of the questions buy this prop would work out real nice if I could get it for the right price and right terms, thank you all.

UPDATE, I was looking in the local classified ads and saw the property listed at a reduced price 157,000. It looks to me that the email the seller showed me at our meeting was total BS and he has not been able to sell the property yet. With that being said I am still interested so I sent him an email yesterday asking if he still had the property and if so I would like to talk again and try to work out a deal. He replied and said there was some interest but nothing on paper and would be willing to talk again. Any ideas on how I should approach this next meeting. I would like to purchase the property with the same terms as my original offer,
155 sale price
14 down
owner finance the rest @6%

Should I draw up a P&S with a deposit to show I am serious.

Any advice would be much appreciated as I would like to aquire this property at the right price. Thanks everyone.