All Forum Posts by: Tim Johnson

@Roy N. and @Jeff B. Thanks for your responses...you summarized the options well.

While the property might be beautiful, if the numbers don't justify pursuit then the right thing to do is walk away.  Regardless of how pretty the sunsets are.

Thanks again for your sage advice. 

Hello BP!

I have a connection to an older couple that are interested in selling their resort in norther Minnesota.  It's been family owned for 60 years. It's beautiful...a dozen fishing cabins in Northern Minnesota on an entire peninsula of a lake surrounded by state forest land.  

The way I've valued multifamily properties is to calculate the Net Operating Income (Gross Income - Expenses) and then divide by desired cap rate.  When I do this for the resort, I'm not getting numbers that approach the properties value.  (I feel like the property is quite valuable, but current revenues are small).  

Are there any other considerations when valuing vacation rentals? Or does anyone have any advice?  I haven't really worked with vacation rentals before.

P.S.  The cabins are too close together to be split up and divided off.

It's tough to generalize and say you should look at one area.  Some folks are after a higher quality tenant, and focus on suburbs with good quality schools.  Other investors are willing to put up with lower income areas because they like the lower prices and high returns in those markets.  Other folks want something close to their home so they can self-manage.  Asking yourself what is most important to you is a bit of a gut check.

If you are looking for a multifamily, I would start by analyzing properties on Loopnet.  Don't put in any offers, just get comfortable with running the numbers.  Maybe go visit a couple properties.  That will help you get a feel for what type of property you want and how much it will cost.

Best of luck to you, let me know if I can help further! 

Welcome @Christopher Hamlett! There are several real estate meetups in the Minneapolis area. I would recommend checking out the MN-REIA site http://www.mnreia.com/ to find out about the meetups and educational opportunities.  The meetups are a great place to find out what people are doing, what is working, and (just as importantly) what is not working.

Best of luck in your real estate edventure!

Welcome @Lisa Filiatrault.  It's always nice to see more Sherburne County folks on this site!  Let me know if you have any specific questions.  Otherwise, best of luck in your next real estate investing steps!

Yeah, there's a balance.  Of course due diligence is important, but many investors suffer from analysis paralysis.  Being ready to move quickly (both financially ready and psychologically ready) can be key in getting a great deal.

Thanks for sharing, and don't let that next one get away!

Hi @Ryan Luthi, welcome to BiggerPockets! I'd recommend the Minneapolis REIA meetings, they are a great opportunity to learn more and network with like minded folks.

Best of luck to you in your real estate adventure!

There are quite a few Hard Money lenders that are willing to finance 100 percent of the deal.  Unless his terms are super favorable, I'd consider another Hard Money lender.  Their are quite a number of them out there...

Hi @Jason Rogers, welcome to BiggerPockets.  If you're looking to connect with like minded inverstors and wholesalers, you've come to the right place!  

Hi @Bobbie Bebereia.

Wow, that's a new one for me.  I'm assuming the seller likes earning his 5.75% so he is basically blocking the refinance.  Immoral, yes.  Illegal, maybe?

I looked a little online.  It looks like if you filed a Land Contract Memorandum you should be able to get bank financing without his "permission".  Do you know if that paperwork was filed when you did the Contract for Deed?