All Forum Posts by: Joe Hughis

@Darnell Copeland - find properties in parts of the country which would can fit with you having $10K as your "skin in the game". In your analysis of properties, keep in mind your closing costs, holding costs, taxes, insurance, marketing, and potential capital improvements. Or you can look to pool your money with other investors. Real Estate crowdfunding or REIT participation seems to be growing in popularity.

@Edward I believe property amenities that are outside of the unit are subject to location and the surrounding properties.  For instance, if the property is located in an area that has predominately colder weather, having a pool and club house maybe isn't a high selling point for a potential renter.  Also, if there are other public pools or recreational bodies of water near by, having a pool might not be that important.  Of course, in both scenarios the reverse might likely be true.  For instance, in AZ, having a pool is a huge selling point for renters.

Regardless, if the neighboring properties of the same class without a pool/clubhouse are charging a range of "x" dollars for rents, it would be hard to properly market your units for significantly more because of the existence of a pool and clubhouse.  Not all renters utilize those amenities and at the end of the day a potential renter is still cost conscious.  But having in-unit amenities, such as a washer and dryer, central air/heat, hardwood floors and marble countertops - are a different story.  :)   What is certain though, is having a pool and clubhouse in your property will increase your expense line.

Hello @Donald S. - You are correct. Conventional lenders will cap out at their max LTV. However, keep in mind that the market determines the price of a property. I say this because if you are buying it for $160K, then that is its value to the lender. Moreover, when it comes to commercial properties, other commentators are correct, a lender will want you to have "skin in the game".

@Phillippa Atkins - Are there not any private money lenders in South Africa? 

@Jeff Sheraton Google Voice. I believe, has an option to review call history.  I don't think the technology is available to determine if the call came in from a landline or a mobile though. 

Hello BiggerPockets community.  

I realize this question is only peripherally related to real estate.  But in the spirit of good fun, I'd like to know what is your most memorable client story?  It can be good, bad and anything in between.  

Have an amazing day!  Thanks!

Thanks for posting @John Spina jr.  Yes, Meetups can be very informative and good places to network and present yourselves to people of like mind and goals.  Who knows, maybe one day, we'll "Meet Up" at an event.  Cheers! 

@Nick Hakim - I think you many need to clarify the size of the "one space to lease up".  What percentage of the property is vacant (sq footage wise)?  It seems that it could be quite significant to raise the 6.5% cap all the way to a pro forma 10.5% cap.  Also, would I be correct in presuming the other portion of the "mix" are residential units?

The basics you mentioned about the property seem good.  However, the vacancy factor may prevent you from obtaining conventional financing.  Moreover, depending on the residential to commercial ratios the mixed-Use property may not be to the liking of many conventional lenders.

Based on the info you provided, I would tend to believe you will likely need a private money bridge loan until the vacant portion can be filled with a quality tenant.  BTW, try to get a longer term lease.  Conventional underwriters don't like short term leases on commercial tenants.  

If you do try a conventional lender, your best bet will be one whom you have a significant depository relationship. Your bank will also likely want you to maintain your operating accounts with them for the life of the loan.  Money in the bank and operating monies could be ways for a conventional lender to get comfortable with their elevated perception of risk brought on by a non-stabilized property.  

@Account Closed  - I think we need further clarification on what you mean by "separate units" as it relates to them having a "common kitchen" and "common living area".   Do you mean this property is set up more like dormitory that has four suites connected to a common area?  If this is the case you may run into challenges with obtaining conventional financing for this property since the property could be classified as special use.  

@Peter Torres - With a $1.2 Million budget, there are many locations throughout the United States that will give you great returns.  For you first larger multi-family property, I would focus on areas that have proved to have rent stability, overall low capital improvement requirements, and a record of property appreciation over simply going for a property that gives you the largest forecast returns.  I would also determine ahead of time if you will be self managing or hiring a management company. Cheers!