All Forum Posts by: Jesse S.

@Kati Finneran a quick calculation someone told me about was to ensure three units can cover the mortgage. That is just scratching the surfice, but a good place to start. 

@Nick Rutkowski @Ryan Short can you tell me more about the rehab cost? I am looking in the DC area at 4 unit buildings, however I'm not sure what the cost will be to rehab the units.

These units are usually in pretty bad shape (3 out of 10). I would like to rent them with hopes of a low rehab cost, while meeting renter expectations by making it a (7 out of 10) so to speak. Unfortunatley, i'm not sure what a low cost rehab actually cost. 

I will be living in one of the rental units for the initial year. Do you think it is better to rent and renovate or renovate and sale as separate units? If I renovate them and sale I would be looking to make them look like an 8 out of 10. I know personal/preference scales will vary, but I hope you get an idea of what I am trying to say. Any help would be greatly appreciated. I am currently working on a spreadsheet to quickly identify good buys from bad ones (cap rate, NOI, CASH ON CASH, etc.).

Jesse from Jersey (currently living in DC metro area)

@Justin Hayden have you purchased the property already? I recently missed out on a great place in NW and I would also add getting "Rent Rolls" to get an idea of what type of tenant you are dealing with. Additionally, I am not sure if this is legal or not but a lot of owners will pay off the tenants and roll that into the selling price. As you can see I am brand new to this so take my advice with a grain of salt... I wish you all best... maybe one day we will be in a bidding war over a 70 unit building :)

Kyle,

I am guessing you are considering areas such as Glassboro since you are in Philadelphia. I think a good strategy may to look for Multi-families close to colleges because you will usually have tenants paying consistently based on financial aid. Additionally, you may be able to utilize the homes for AirBnB when students are not there. 

Finally, I would check to see if section 8 is available in various areas and do a cost comparison of which towns provide the highest payout.

Just my humble opinion. 

I have a few questions with regards to an LLC and it's applicability to owning a 4 unit multi family unit.

In short, I am curious as to what the advantages and disadvantages are and if an LLC is necessary.

Additionally, I am curious as to if I place the home under my current LLC what are the advantages and disadvantages?

P.S. I am in DC and the market here is ridiculous. I just got beat out yesterday... but at least I made my first offer. I am welcome to any excel sheets you think may help with analyzing the numbers to determine if it is a good deal or not. (First-time home buyer).

Thank you for your responses in advance

@Todd Dexheimer I am not questioning your evaluation at all, but I am curious as to how you came up with your estimates as I am super green to all of this. 

@William Hochstedler great answer!

That is a good overview of how to start. Thank you. 

@Marlen Weber

Thanks 😁

@Russell Brazil

Thanks for the quick reply...

So you know my pain 😩.

I heard there is a law with regard to renting rooms separately. Something around the nature of each residence needs to have a meter. Do you know anything about that?

@Brian Boyd

Great advice! Thank you! I actually have an agent... there just hasn’t been much effort on her part. Truthfully there hasn’t been much on my part either, however my lease is up in June so I need to get a move on things.

Thank you again for the insight