All Forum Posts by: JaMarcus Joseph

@max tanenbaum

These are minimum wage or slightly higher class tenants. I'm not sure of all the tenants' stories yet, but I know a few work overnight at Walmart. There isn't room for washer/dryer in the units. So the tenants are forced to do laundry elsewhere. There really isn't any advertising for the laundromat. I've passed that building for years headed to the liquor store. I thought it was an office of some sort. I'm guessing with some advertising, it'll get more people in.

What does your friend say about car washes? Automatic or manual? This property has manual stalls. Would an automatic machine be the better investment?

Anybody have any experience with these kinds of deals?

I have a 10 unit, laundry mat and car wash combo under contract. It's 100% occupied and the extras are functional. It was built in 2007. They have not produced any financials and the realtor is not sure they will.  Last year's tax records show the income for the property was 51k and the expenses were $74k. I know these records likely aren't accurate because the owner is in bankruptcy from mismanaging 4 sets of complexes and pocketing profits.  The apartment side of the building(all three are connected) is two story and doors are internal. The laundry mat has 4 washers and 4 dryers. The car wash has 3 manual stalls and 3 vacuum cleaners. This first picture is using the numbers from the taxes.

This pro forma isusing potential income given advertising expenses. It's the only car wash and laundromat between 2 smaller cities. I think it has the potential to be managed to become profitable. Do the numbers for the additional business seem reasonable? I'm hoping they're way low as far as average daily use is concerned. 

Dude I thought you were asking for advice. Both comments offered help. I have interest in the success of that city.

Lol @Brent Coombs Doesn't look like it, right!

He bought it on a tax sale for $16,500 according to tax records and refuses to negotiate a reasonable price. The units are 16 efficiency and 16 one bedroom with a laundromat. They're on one water meter and one electric meter. Fire chief says they need to be completely gutted to install new fire sprinkler system. However, the entire city is on board with anyone rehabbing them. They have a problem with slumlords. The new mayor is in a campaign to rehab the city by removing nuisance property. They have a grant approved for the removal of 700 houses. They've already started  taking people to court. The city's gang problem is mostly resolved. A city official told me the story of the raise and fall of the gang leaders. There are talks on the radio of new ordances making it a better place to live. The city needs quality investors looking for long term returns. I believe in the city because the young blood in the offices now believe in their city.

Purchase Price - $55,000

Estimated Rehab - $5000

Acquisition Costs - $1375

Sales and Commission - $7155

Total Acquisition, Rehab, and Resale - $68540

Approx Total Profit if sold @ low ARV (89k) = $21000

I have a SFR built in 1969 a B class neighborhood North Little Rock near Camp Robinson under contract. The neighborhood is mixed homeowner and renters. It's 3/1.5 with a fireplace, large living room, decent kitchen, fenced backyard, screened in covered patio, and a shed in the back. The property is in excellent shape. It was owned by a bowling alley mechanic who has passed away. The house is an estate sale. Today, we passed foundation inspection with no active settling visible. The house is structurally sound. My contractor partner thinks the house is a basic deep cleaning, carpet, and paint job with a few fixture updates.

The school system isn't the best right now because Pulaski County neglected the local schools for other projects in other areas. According to a teacher/coworker and local radio, the school district is actively fighting to correct its mistakes. As long as quality investors provide quality housing, the neighborhood should improve rather than decline over the long term. It has a rental rate range of $850-925. Recently sold low comp says ARV is $89,000. High comp says ARV is $94,000. Currently listed high comp puts ARV at $100,000. Anyways, here are the numbers.

Flip

Total Purchase Costs   $1375

Thanks for looking.Flip Spreadsheet

Hey Neil

I know the complex you're talking about. I did some due diligence on it. That area is a growing area. According to one of the city code enforcers, that's where all the money will be at in the near future because industry is coming to that area. Also the high school is 2 blocks away from the elementary basically across the street.  There's also a Tyson Chicken down the road. If all else fails, the city says there are about 70 unfilled housing vouchers for quality 1-2 bedrooms. It'll be a real cash cow even if you don't hit market rents. Also, the lot next door offers room for growth.

Have you spoken to the city about the repairs required to meet current code? Do your repairs include the new overhead fire sprinkler system required by current code? Are you keeping all the electricity on the single meter? How does the single meter effect your NOI? Those utility bills are going to eat the budget. Do you have a plan for that? I think you should contact Ron Hughes with HERS, INC. He does energy efficiency assessments. He'll point you in the right direction of green tax credits and potentially monies. For example, Centerpoint energy offers a $600 rebate on tankless hot water heater systems. Entergy offers some sort of rebate for energy efficiency efforts. In the short term, solar panels don't seem logical. However, on a project where the landlord pays all utilities, the long term would be extremely beneficial. Using internet sources, I calculated the monthly utilities to average upwards of $90 per unit with standard methods. Energy efficiency can save an average of 60% in utilities or more. I think it could get down to about $15-25 per unit range with the right modifications.

Anyways, I've rambled enough. I think it's a good buy if you're not afraid of the area. It's also a good flipping market. I hear it has a reputation for big time apartment buyers out there when they're performing.  PM me if you want to chat about my experience with the sellers. It's positive. They seem like decent people. 

JaMarcus

Welcome to the community. Are you a fellow Bison? I'm a relatively new investor in the Searcy area. I have an apartment building in Judsonia. What do you think about the Searcy market? What makes you choose DFW over your local market?

To answer the intro questions. I've been in real estate since Summer '13. My first deal cost me $1000. His phone turned off and he disappeared the next day. Took that as a lesson to educate myself. This past summer I closed on a 5 plex and rehabbed it along with my wife. Last unit goes on market Monday. 

I would like to learn better ways of skiptracing without paying for it. I'd also like some insight on talking to living relatives of deceased property owners. There is a house under the wife's name and she died. The husband lives with a daughter. Had to discover the death in order to find them. How does one get past that?

In a joint venture, I'm lacking capital. I have the time to find deals. I actually have several deals on the table that I may lose because my financing fell through. My PRN status at the hospital gives me an extremely flexible schedule to focus on building my fortune and work enough to pay the bills.

So far, my only deal came from Craig's list. And the funding for it came from BP. My wife checks it regularly for us.

I really like the Thrifty Nickel and other local newspaper. It's am excellent way to find landlords. Granite I just have a potential buyers list that isn't too interested in rehabbing the property themselves. I also use my college classified sections for good deal, landlords, and potential tenants. The landlords on there are pretty specific on proximity to the college. The college has first dibs on most property within 1/2 mi in either direction. So that'll be a huge score to catch some property off market there. Anyways....

Finally, my favorite way is simply driving for dollars with my wife. It's good quality time and work. We've grown a lot together. It's also a good time to listen to a book or podcast. I currently have 3 properties under contract from that, including a mismanaged 33% occupied 12 unit.

Another suggestion, just go talk to the city to see what information they'd be willing to share. Working on funding the rehabbing a vacant 23 unit that the city directed me to. They also gave me the number to another vacant structure that could potentially be converted.