All Forum Posts by: John Baughman

@Nandy B.

Bought a house from an out of town owner on “Contract for Deed” with $0 down for $12000.

It was trashed by the previous tenant who left all their belongings and left town.

I got a dumpster, had 2 guys clean it out for $500. Sold it to a rehabber for $22000 in about a month.

Heck yeah I’d do it again.

@Cameron Peters , I have RE-engaged.  Not as I planned, but I have.

I've done some marketing and have had good response.  I bought a house in August that I intended to fix up and keep or sell.  But before I started the rehab, I threw it out on Facebook and Zillow, and while I was just getting it cleaned up I got an offer and sold it for a quick profit! 

Right now, I'm in the middle of my first accidental wholesale.  I put a duplex under contract that I intended to keep forever, but a buyer came to me for a quick profit and we are going to a concurrent closing. 

So, yes, I have RE-engaged. This town is great for cashflow. And I'm going to get to keep one of these properties soon.  Currently, I'm looking at mid-sized apartment buildings in town.

Maybe its been asked, but I cannot find it anywhere. 

In Illinois, one needs a license to manage real estate for others.  But owners can manage their own properties.

Does anyone know what percentage of a property a person would need to own in order to manage it without being a real estate agent?  I.E. If I own 10% of an apartment complex would it be legal for me to manage the asset without a license?

Sounds like a lot of the deals I'm analyzing out here in the middle of nowhere. 48k for 15 yrs @ 6% is a payment of about $405. Curious about your property taxes and repairs. Let's get conservative: $2500 gross income Less 30(yes 30!)% vacancy. $750 20% repairs and CapEx $500 Let's guess at taxes ($2400 year?) $200 Are you paying for water? ($1200 year) $100 Electric/Gas? ($6000 year?) $500 Lawn care/ Snow Removal? $100 Dumpster? $150 I'm really spitballing here. But you have to consider it all. And I'd plan on higher than expected vacancy. What other expenses will you be responsible for? If the above is close to accurate, you'll have $2300 expenses a month so you'll get the pleasure of coming up with $200/month to cover your mortgage! Yea! But say the tenants handle their own electric? Gas? Water? These #s quickly swing in your favor - even with high vacancy. What are your "other" expenses?

If they're ready to let it go, it doesn't matter if it's listed with an agent or not. Offer what you need to offer to make the numbers work for you. Maybe you'll get a yes. You MAY be the only person who has given it any attention at all. 

In Illinois, Chris Chesser , I believe the purchaser must make the taxes current. That said, you might have a decent lead there. Typically, late taxes mean there are other issues. How did you come across the property? It would certainly worthwhile to send a letter to the owner and see if they'd have interest in selling. As far as how it's owned. Often if there is a death, if you google the names involved you may find an obituary. At least that's how it works in my small town.

I like it.  If you cannot find 4 units that generate approx. $2140/month for the $100-150K it will take to double your space, and it won't eat your time up too badly. 

@Dan Voykin will you lose revenue downstairs during construction?  I'd consider lost rents.

This would be a commercial loan. Most commonly: 75% LTV loan to value. 20 year amortization. Probably in the range of 6% (for 3 years). Plug it into a loan calculator. You'd need to find a way to come up with 25% down payment.

Get another rehab proposal, and then another one.

Wow. That's a great question. The #s are more borderline at 125. What a great question!