All Forum Posts by: Jeremy Dockendorf

Totally understand @John Woodrich  

Appreciate you reaching out. Maybe we’ll talk in the future. 

@Austin Hendrickson that would be great! Could you PM me?

@Yonah Weiss thanks! Certainly a good point about the timing. Just trying to get my info now for future use. 

Looking for a CPA with REI experience, preferably not too far from the St. Cloud area. Trying to learn more and need help navigating the tax implications for various options like SDIRA, 1031, etc.

Thanks for any recommendations!

I’ll pose my questions first and fill you in with the scenario below. Looking at the numbers on this deal it seems viable, but I have two concerns I’d love to hear feedback on. 

1. The property value is decreasing. It is a bigger house on a bigger parcel than most of the others around it. The value of most homes in the neighborhood is around $140k. This has been listed at $175k for almost a year and still hasn’t sold.

2. Is it likely that doing STR in the guest apartment above the garage would deter long term renters for the house?

Quick background: 

It's a single family home in a "just ok" neighborhood. Built in 1930 with 4 bed, 2 bath, and needs moderate rehab - kitchen cabinets/countertops and a bathroom vanity/sink. Has a 3 stall attached garage with a 1 bed, 1 bath apartment above it with private access - needs no rehab. Says it's licenced as a 2 unit rental. Being located right across from a hospital and not far from a downtown area, I think there is good potential doing STR in the apartment above the garage while doing LTR in the house.

The potential numbers:

Purchase for $165k, $10k rehab

Rent: $1350 house, $792 STR apartment ($99 @ 8 days occupancy)

Cash flow: $560

NOI: $1228

Purchase cap rate: 8.94%

Cash Return: 14.6%

IRR: 11.86% at Year 5 assuming home holds value of $165k at 10 years.

All the numbers look good to me, but I still need to reach out to the agent to learn more about the rental history. Seems odd that it’s been for sale for almost a year. I’m totally new to this, so would love to hear your opinions or get ideas on things I’m not considering!

Thanks

Thanks @Lisa Graesser, @John Underwood, @paul sandhu, and @eric p.

I’m pretty new to real estate investing in general and I’m trying to get a feel for what kind of occupancy rates are going on in my area with AirBNB. Is it reasonable to summize that the number of reviews left per month for a host would be an accurate indication of the number of bookings? (I realize that can’t give true occupancy since I don’t know the length of stay and of course there could be some guests that don’t leave reviews)

I just don't think the demand is real high here. The free report on AirDNA suggested about 50% occupancy for a property I'm interested in for STR potential. A local super host with a very comparable property that only requires a 1 night minimum has 38 reviews in the last 12 months (3.17/mo. avg.). Could that really come close to 50% occupancy? Guests would have to avg. a 4+ night stay.

 Good advice. Thank you. Yeah, we’re still working through the business plan right now. The cash flow statement will be the telling piece here soon depending on how we finance it. Thankfully the property is nearly turnkey. 

 Good advice. Thank you!

Hello,

Curious what your thoughts are on how to approach a seller of a single family home (farm) that just pulled their listing off the market a little over a month ago. The property is a house on 40 acres with several outbuildings set up for equine. It was listed from Sep-Jan at $775k but I think it’s been unoccupied since May. I’m struggling to figure out what the real value is because it’s a little too unique for my area for me to be able to find any comparable sales (but I really don’t think it’s worth 775). I know that I would need to get the price down to at least $650k or less to make the numbers work as an income generating property. My wife and I are wanting to use it for a couple business ideas, namely equine boarding and hosting weddings/events. The current owners actually live in a different house just a couple places down the road. So we know where to reach them, but not sure on the “how”. Since financing is a big concern (as we may need to get SBA funding for some of this) we are thinking maybe C4D could be an avenue to approach them with?

I know there’s a lot of ambiguity and unknown here, but any advice for this newbie on how to approach the sellers would be greatly appreciated!

Thanks, Jeremy