All Forum Posts by: Josh Key

Im actually working in clarksville on a jobsite now. Igo up their from time to time.  Clarksville is a small city.  Id say it has 3 main areas of employment other than your normal service types.  Its a factory and military town mostly with lots of farm land around too. And its fairly cheap area to live as well.  Many people live there and commute to nashville as well.

I know its an area we are looking and buy and holding too. I was looking at a 4 plex there a month or so back. Theres lots of stuff for sale there. So hopefully this little information can help you some.  Id say take the area with a grain of salt though. Recently they cut some of the bases jobs and were every contimplating shutting the base down. It caused a big fear there because so many people are dependant on the base and the people that work there.

Loosing the base would drastically effect the economy and the factories dont really pay people very much on average. Good luck though.

Id say it depends on your budget to what area of town to aim for.  Some of the booming areas are east nashville, 12 south, hendersonville, donelson.

Maybe that helps and gives you some ideas.  If you want to spend some money a lot of development is going on in franklin and cool springs area as well.

Hey you guys are awesome. Thanks for the lending advice.  We researched it more and I found several partners but once I found the numbers to make it work I was setting a ton of money aside for approx a 5% return at best.  So we are going back to our original budget and keep looking.

The house hacking idea would not be ideal for us unfortunately.  We currently live in a town home that is paid off and 20 mins from our work.  The 4 plex is over an hour away from our work and not worth us living there.  

Currently our plans are to just rent our current house for 1500 a month and use that money as reserve or to pay for the next mortgage while still saving or paying down the new note too.  Our main problem is we need a mortgage as a tax write off and we want to invest our savings at more than 1 or 2% savings in a bank account.  And stocks are not what we are looking for.

I'll keep looking at more properties and keep trying.

im currently looking in the Nashville market for small multi units and it is low cap rates for sure from what I've seen so far.  A lot of stuff is priced top dollar.  For example, I'm looking at a 4 unit right now, it listed 4 months ago for 225k, now it's sat on market 120+ days and they raised it to 233k.  

I can still get it to cash flow but I definitely don't think it's worth 233. Even if I offer 170k it comes in at 8.75% cash on cash and something around 9% cap.

Maybe this helps. And I'm not direct mailing or anything serious, but I just skim the mls past few months.

Prices constantly climbing all over the place for past several years on just about all the property.  Also if you need a lot of repair work, I'm in the construction industry. The work load is so heavy most commercial and industrial projects are on very long wait lists into the years.  So finding contractors worth anything can take you a while.

Example, I recently had our HVAC cleaned, it was 3 month wait for a 100$ job.  Just everything is slammed and almost every company I see is hiring.  Hince people moving into town for stable work. And then the properties are being bought up.

So its pretty busy around town. Maybe that helps you a little.

Welcome to BP.

OK, i only factored in 10% vacancy.  We didn't really intend to house hack a multifamily home.  If i do it would be a single family. And then we would just rent our current home out to pay the new mortgage. 

With 25% vacancy it would put our cash flow at -$100 a month.  Which isn't really a deal breaker, but i know it wouldn't be sustainable. 

So at the 5% loan and a 25% down payment I wouldn't feel comfortable raising that much money for a down payment.  We would likely have to take out a line of credit on our current home and we we're looking to keep it paid off 100%.

hey all!

So we were originally budgeting for around 100k and have saved 22k for a down payment.

last night my fiance and i found a 4 plex listed for 233k.  They originally listed the building for 225k on 9/15.  On 12/15 they raised it to 233k.  The current owner has revonvated all 4 units HVAC's, a 3 year old roof, and remodeled some 3 of the 4 units.

The location is 2 miles from a main interstate, blocks away from the local mall, restaurants, and several large factory employers.

The property appears to be well taken care of.  So last night we used the buy and hold calculator and with 20% down i need 45k down payment.  The property will cash flow $499 a month assuming 3.9% loan at 1 point, 120 month management fees (doing it ourselves) 5% cap ex, 10% maintenance.  2% property value increase and 3% cost and rent increases.

So at first glance it looks like a solid investment.  But, my questions is,  should i really expect to come up with 45k down payment?  Or is it possible to get a conventional mortgage at somewhere around 10%.  If i need to raise the other half of the down payment we are considering selling equity partnerships to some family members.  We still want to look up the legal ramifications for that as well.

Any thoughts or opinions would be grateful. Thanks 

Welcome to BP.  

i also agree the Davidson county area is very high.

Rutherford county has the stable economy with plenty of jobs available.  That's an area we are looking to buy, but the traffic is bad too.  I wonder if that turns people off.  I look towards Hendersonville and cool springs as well.

I've got family buying homes in Nashville for 85 to 90$ sqft and tearing them down and selling 2 homes on the same piece of land divided into 2 for over 200$ sqft.

The market is crazy because so many out of state people are moving in.  I've heard it's over a million people a year moving in. 70 something families a day.  The job market is hiring nearly everywhere. And the housing is becoming scarce.  But I'm not buying in Nashville because I believe it's way too overpriced.  We are even considering renting our current home in Nashville and buying farther out.

Our 3 bed 2.5 bath 1 car garage has increased 40k in less than 3 yrs. Just to give some comparison.  

Maybe that helps.

 It really depends on your budget.  BTW, I'm no expert so please take my opinions with a grain of salt.  But, the budget determines your area, for example over near Belmont or vandy, you can't really get into the market for less than 200.  East Nashville is selling homes from 130's and up, yet two or three years ago they were selling for 30k less.  So we see a lot of areas we think are over priced.   East Nashville and Belmont areas has a lot of out of state people moving in, so they come in seeing homes for 150k and its cheap to them.  And it's hard to justify a 1300$ rent when you can buy for 1000$.  There is still deals all over.  I had a guy I roomed with 2 years ago there.  He bought the house for 100k from a family that was just sitting on it and neglected it for years.  We worked on it and put about 30k in it.  It appraised for 120 the day he bought it and he's already had offers by 2 investors for 145 and 149.   Yet he has a 15 year note at 950 month so he is just renting the rooms and living there free now.

It was an off market deal in east Nashville, so you can still find stuff.

Personally I'm looking around 100k.  We are doing a buy and hold strategy and trying to get homes on 15 yr notes and have them paid off in 5 to 7 rather than buy a bunch of properties.

So we are looking at the suburbs of Nashville like Antioch, Smyrna, cool springs, Hendersonville. Places like that.  It's the working class areas with stable jobs. And good schools and infrastructure.

The southeast side is cheapest, but riskier tenants, but you have a lot of long term stable jobs there like the Nissan plant, wear housing, amazon, airport workers.

That's just my personal strategy's.  I'm looking for stable tenants that will help me pay down the mortgages fast. I can't afford to enter the areas where the wealthier students want to be, but I'm trying to stay out of the ghetto areas too.

Maybe that helps you some.

If you guys have more questions I can try to help too.  What area's are y'all looking at and why?