Investment Info:
Single-family residence buy & hold investment.
Purchase price: $715,000
Cash invested: $297,000
Current Listed Price: $830,000
Original Listed Price: $950,000 (4/13/2024)It has been reduced $120,000 in the las 6 months and hasn’t sold. Also Seller hasn’t paid property taxes in 2 years which is a sign the property is in distress.
Seller is the Agent.
Seller bought property in January of 2023 for $730,000
Current “As Is” Value : $770,000
Target Acquisition Price: $730,000-$780,000
After Repaired Value: $900,000
Repair Estimate: $120,000
Initial Offer Amount: $715,000
Loan Program: Bank Statement Program.
Total Estimated Monthly Payments (Principal, Interest, Taxes, and Insurance) $5500/month (based on $770k purchase price)
Estimated Gross Yearly Income from Short Term Rental: $160,000 (65% Occupancy, $700 a night| (STR Listing Comparable properties Listing 1 Listing 2 Listing 3)
Net Monthly Income after management and taxes: $11,751.25
Net Monthly Income after Mortgage Payments: $6251.25 ($75,015) Per Year
Total Cash Investment: $297,000 ($177,000 in down payment and closing costs and $120,000 in repairs)
Average Yearly Return on Investment: 25% yearly
Average increase in property value per year: 5%
Average increase in booking revenue per year 7.5%
Property Value average after 10 years: $1.5 million
Total Cash received over 10 years: $1.3 million.
Total Equity multiple min over 10 years: 6x total return on $297,000 invested.
What made you interested in investing in this type of deal?
This is what my company does for our clients.. This is what I do. We give an A-Z Solution. We own a real estate, mortgage, and property management company solely focused on Short Term Rental Investments
How did you find this deal and how did you negotiate it?
Every Week I scan the MLS, navigating cities and towns in South Florida that are friendly (and not friendly) toward short term rentals. I compile the list of only properties that can gross six figures plus and with prices under $800k. I then send these to my clients.
How did you finance this deal?
Being a 20 year mortgage expert and real estate investment veteran, we used our mortgage company to secure below market financing.
How did you add value to the deal?
Being a one stop shop for mortgage, real estate, and property management helps us save our clients $$$ and they only have one company to deal with and one contact saves time and creates an unmatched synergy.
Lessons learned? Challenges?
The property will need to have a slight rehab to get it up to STR standards, but when complete it should easily be a $200k Gross booking revenue property.
Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?
Yes we are all in house.
