All Forum Posts by: Jaiden Olsen

Hope to see you at the Real Estate Meet-ups. They are great!

Structural Engineering is actually what I do for my day job. Send me a message and I would be happy to come look at your project and give you a few recommendations. Digging out a basement can be extremely expensive. Getting it done from an engineering stand point is one thing, but making sure that the deal justifies that kind of rehab would be another. I looked into doing it myself an a project a couple years ago. I just couldn't justify the amount of work/time/money. There is no way that the payoff was high enough for me. I hope you that the numbers work for you though. I know of an investor who uses that strategy regularly and does fairly well. Good Luck!!

Shout out to my small town investors! I grew up in Manti and am a Snow College grad! I am finding the numbers to work better in the small towns as well. One of the challenges I am facing is finding a good property manager in those small towns. I think that Price and Emery county is a great market for single family rentals. There are lots of working class people who have steady jobs that may not want to buy. I'm not an expert, but I think that the future is bright for Emery County . There are lots of natural resources that still have a long life. That's just my two cents. Find the right deal and make it happen!

I think it's a bad deal. I live in the Salt Lake area. I can't justify buy and hold in the silicon slope area without taking on a lot of risk. The Cap rates are too low and the calculated risks are too high. You can see my analysis at the link below. If you were to purchase this property with 25% down, at the asking price, I think that you would be losing money for a few years until you can increase rents 20% ($1200-$1300 per unit). Even then you are still breaking even. If you can double the rental income, then it would be a good investment.

952 E Princeton Ave 4-plex Analysis - JTO

Thanks all for your comments. I ended up backing out. After meeting with the seller, I decided against it, mostly because I didn't like him and my gut told me it was a bad deal. I appreciate all your input! You guys are great!

 Thanks for your comment! I'm a little leery for sure! I'd like to know what thoughts you have about the amount of cash flow. Is there a lower limit on how much the property would have to generate in order for it to be an awesome deal? $250/month sounds good, but is it worth the 1/2 a million dollar investment? That is only $63/door.

Thanks again!

 I plan on using a property management company, so my time would be minimal. 

The net operating income is $1,813/month and the estimated monthly payment is $1,390/month. So as long as I'm maintaining a vacancy rate of less than 5% (at $700/month/unit I think that will be easy), I can't imagine that there will be any concern for defaulting on the loan. Is there more that I need to consider?

Dave, Thanks for your input! I think that is great.

I should clarify that I am already considering all expenses (10% for property managment, 12% for repairs and maintenance, 5% for vacancy, and PITI). So I'm quite sure that all of that cashflow is profit.

I've got a potential Opportunity to acquire a property with no money down. It's a 4-plex. 

My question about a no money down opportunity has to do with how to analyze the numbers? Because I have no money down, any cash flow generated would result in an infinite ROI. For instance, if I acquire a property worth $500,000 and it looks like it can cashflow at $250/month, my initial total investment would be $0. Therefore my ROI is infinite. The market in Salt Lake City, Provo, Ogden, and Logan is crazy right now, so financing anything is really hard to justify. CAP rates are regularly between 3-4%. But I need to get into another deal, and the future looks promising. So my question is this: is it okay to justify 2-3% CAP rates if my ROI is infinite? and if so is there a lower limit on the amount of cash flow I should expect on any given property?

Thanks for your feedback!