All Forum Posts by: Jonathan Napper

Old post I know but is that contract EXCLUSIVE? (IE Can the seller sell it to someone else? Do you have A option? Or is it an exclusive option?)  How much do you pay for the contract? 

yea, I can mange and save. I have asked for revenue proof from the cabin. If the revenue checks out, think its a good play?

Thanks

I just realized I posted this in the wrong category. Can ADMIN please remove? I already posted in correct category.

Sorry :/

Like everyone else I have been looking, connecting, negotiating and I think I may have found one that will work. The fact that this property is a Class A property located in the most visited National Park is just icing on the cake. I would appreciate your thoughts on this possible deal.

Facts on the seller - Has owned two cabins for over 10 years - he built them, wants to move his family back home to California. The cabins are in the most ideal locations.

Facts on the Lease - After 9 weeks of negotiating (and walking away from it completely on my part, more than once) the seller has agreed to a 1 YR Lease Option for a Upfront $2,500 Fee - which includes the 1st months fee. The monthly Lease Fee will be $1250 - which will cover his Loan Payment, Taxes & Insurance. At the end I can purchase or walk away if I don't think the cabin will perform.

Facts on the Purchase - If I purchase he will carry the full amount of $170,000 in a 20 YR seller carry note at 6%. I have confirmed with a local bank who VERBALLY said they could do a 4%.

Facts on the Value Add - He only uses VBRO to bring in vacationers, I could list on AIRBNB, HomeAway, Craiglist, Ads or Flyers...etc to bring in more. The upstairs loft has a pool table, I could toss that out and put another bed up there, turns this sleeps 4 cabin in to a sleep 6. (Increase the nightly fee and open up to more potential vacationers)

Facts on the Revenue - Documented GSI over last 4 years from the cabin.

YR1 - $24,000. YR2 - $23,700 YR3 - $25,000 YR4 - $26,300

For this breakdown I assumed $23,000 in GSI, or $1,916.67 per month.

HOA - $18.33

Direct TV - $42.75

Shared Well - $20.00

Utilities - $160.17

VBRO - $33.34

Lease Fee - $1250

Turn Around is paid separately from this income - so I didn't included it.

NOI BEFORE TAXES - $392.08 (Assuming $23,000 in GSI)

NOI BEFORE TAXES - $558.74 (Assuming $25,000 in GSI)

Facts on the Variable - 2-3 Winter months don't book up to cover cost, but that cost is more than made up in spring, summer and fall. I also would be managing it, which isn't the long term goal, but I have more time than money.

Facts on the Awesomeness - This will only cost me $2500 out of my own pocket, for a Class A $190,000 property producing $23000-$25,000 a year, over 27.5 years isn't this a deal?

Thanks!

Jonathan

@Joe Villeneuve

@Clay Smith

Like everyone else I have been looking, connecting, negotiating and I think I may have found one that will work. The fact that this property is a Class A property located in the most visited National Park is just icing on the cake. I would appreciate your thoughts on this possible deal.

Facts on the seller - Has owned two cabins for over 10 years - he built them, wants to move his family back home to California. The cabins are in the most ideal locations.

Facts on the Lease -  After 9 weeks of negotiating (and walking away from it completely on my part, more than once) the seller has agreed to a 1 YR Lease Option for a Upfront $2,500 Fee - which includes the 1st months fee. The monthly Lease Fee will be $1250 - which will cover his Loan Payment, Taxes & Insurance. At the end I can purchase or walk away if I don't think the cabin will perform.

Facts on the Purchase - If I purchase he will carry the full amount of $170,000 in a 20 YR seller carry note at 6%. I have confirmed with a local bank who VERBALLY said they could do a 4%.

Facts on the Value Add - He only uses VBRO to bring in vacationers, I could list on AIRBNB, HomeAway, Craiglist, Ads or Flyers...etc to bring in more. The upstairs loft has a pool table, I could toss that out and put another bed up there, turns this sleeps 4 cabin in to a sleep 6. (Increase the nightly fee and open up to more potential vacationers)

Facts on the Revenue - Documented GSI over last 4 years from the cabin.

YR1 - $24,000. YR2 - $23,700 YR3 - $25,000 YR4 - $26,300

For this breakdown I assumed $23,000 in GSI, or $1,916.67 per month.

HOA - $18.33

Direct TV - $42.75

Shared Well - $20.00

Utilities - $160.17

VBRO - $33.34

Lease Fee - $1250

Turn Around is paid separately from this income - so I didn't included it.

NOI BEFORE TAXES - $392.08 (Assuming $23,000 in GSI)

NOI BEFORE TAXES - $558.74 (Assuming $25,000 in GSI)

Facts on the Variable - 2-3 Winter months don't book up to cover cost, but that cost is more than made up in spring, summer and fall. I also would be managing it, which isn't the long term goal, but I have more time than money.

Facts on the Awesomeness -  This will only cost me $2500 out of my own pocket, for a Class A $190,000 property producing $23000-$25,000 a year, over 27.5 years isn't this a deal?

Thanks!

Jonathan

@Joe Villeneuve 

@Clay Smith 

@Clay Smith 

Its over off of Clara Avenu - its on the MLS. If you want to grab a beer or something on me, just let me know.

If I changed this to a 20 year 4% it would look like this. $35K is the ASKING PRICE.

AP - $35K

GSI - $9K

Debt Service - $2,400 ($33K 4% @ 20 yr)

Taxes - $200

Insurance - $500

Management - $900

Max Cash Flow - $5,000 ($416.69 pm)

Variables

Repairs - $2,000

Vacancy - $900

Variable Cash Flow - $2190 ($182.50 pm)

I would still get my initial investment back, inside one year.

I don't foresee a need to sell it until the 27.5 year mark, I can out the equity to work with HELOC without selling it. ROI is 6% (From investment cost) but my ROI is 110% (From my initial investment) HOWEVER this is assuming I pay asking price, each 1K cheaper I can negotiate down would have a impact on these for the better.

Thanks!

@Clay Smith  - This is right next to Churchill Downs.

@Joe Villeneuve 

@Clay Smith 

If anyone could share their thoughts on this property, that would be great. It would be my 1st property. I would utilize my "First Time home Buyers card" as I do not own a home.

Notes: Investor bought it cheap and put $12-15K into it for upgrades, brought it to S8 reqs and it has a S8 tenant paying $750 per month. It does not need any real work, roof, foundation, appliances are good. Numbers are verified.

AP- $35,000

GSI - $9,000

MTG - $33,000 @4% 30YR = $159.00 ($1,891)

Taxes - $200

Insurance - $500

Management - $810

Max Cash Flow - $5,509

Variables

Vacancy - $900

Repairs - $2,000

Variable Cash Flow - $2,699

I get my investment back in one year.  What do you guys think for a first property? (I have heard both side of the Section 8 Coin)

Are there interest rate differences between a HML loan for 6 months and a Bridge loan for 6 months?