All Forum Posts by: Joe Colasuonno

Yearly $75/unit

So for your example, a 2 unit with a $1400 rent roll.  Right off the bat, I would need to see what the unit mix is.  Typically in Allentown you'll have a converted row home that has a 1 bedroom unit on the first floor and a 3/4 bedroom unit on floors 2 and 3. 

Rent is going to be largely dependent on not only the unit mix but also the quality of the finish product.  

For a nice finish product on a typical 1 bed/1 bath unit in center city you can expect up to around $800 ($850-875 if the unit is extra nice or has something else going for it, like being super large, exposed brick walls, etc.)  The 3 or 4 bedroom unit can rent for $1100-1200 in similar condition assuming new updated kitchens and baths.

So what might be advertised as a $1400 rent roll, may very well be able to be $2000 with less than $10-15k in work.  A savvy investor may look at the property and realize a $10,000 investment in some new kitchens and bathroom updates may net them $7000 a year in additional rent.  This may be happening with some of these properties.  I know you're taught to generally buy based on in place rents, but real solid market knowledge can make you comfortable with deviating from that rule in certain situations.

I would underwrite your deals with 1 month vacancy, $700-1000 per unit in repairs and capex, 10% management, and accurate taxes, $375 per unit for trash annually, $75 per unit rental fee annually, $20 per month for common area electric, $800 per unit if you pay gas heat and hot water, $1400 per unit if you pay oil heat and hot water for tenants.  $850 for insurance for duplex.

Also gotta keep in mind that a lot of people buying duplexes are self managing and not including management fee in there, which is going to put you at a disadvantage.

Hey, I am a veteran Allentown investor. Shoot me a PM with your contact info, I don’t mind taking some time out to review your numbers quickly. You may be analyzing the properties wrong.

I'm on the west end also. I love Allentown for investing in multifamily. You should be able to find something that makes sense. I agree with Dave, a 4 family will get you the most bang for your buck, and still allow for you to buy FHA.

Hey man, where do you live currently?

What are you looking to learn @Anthony Lewis?

I am assuming you're talking about a certain converted warehouse property?

Allyson,

What are the rents and unit mix now? Typically if the landlord pays heat, the rents reflect that. What kind of heat is it?

@Justin Brown

When you say “good,” you need to clarify. There are handymen that know what they’re doing, but you have to babysit them the entire time. Thats probably the best you can hope for.