All Forum Posts by: Karah Collins

Hi Joe!

A-- This assumption was just based off of my call with the seller agent this morning. It would be at my discretion to retain the tenant and property management company, but having an existing tenant seems pretty lucrative at this point.

I would like to cashflow for a few months while I take the time to build an adequate team and thoroughly estimate the cost of all repairs. The cash flow I get in the first few months of keeping the tenant would allow me to at least partially float the mortgage during remodel. However, after said conversion, I  eventually intend to evict the current tenant and convert the home back to MFH of (2) 2/1s.

B--That's a great point about how I was mistakenly conflating values. However rent for a 2/1 in this area is still ~$1300.

Hello everyone,

Wanted to take my first step by introducing myself to the forum. Last year really transformed the way I think about money and I am ready to start on my journey to financial independence.

I stumbled across Bigger Pockets Real Estate about two weeks ago and was immediately hooked. Stories of people who have overcome obstacles and lack of resources has made me believe that I can do the same. I know it will be hard, but I’m ready to learn.

I frequently use podcasts as a way to learn, but have always held back from engaging online. I am excited to hear the various perspectives of the seasoned investors on here, further educate myself with BP resources, and continue binging the podcast!

At this point, I am interested in buy and hold multifamily homes. My target market is the Jacksonville, FL area. I picked this city, as it seems to be growing, I am a Floridian and am familiar homes and certain neighborhoods, and also have an aunt who recently moved to the city and could check up on renovations for me. Most importantly, with BRRR homes in the $60k-70k range, which would be an attainable down payment for me. I am still developing a strategy for how to raise capital should a more expensive property come to market.

I live in Manhattan with my cat, and in my spare time enjoy yoga, aquascaping, reading, balance boarding, and true crime. Excited to form new relationships here and attend an event when we are no longer in a pandemic!

Karah

Architectural engineer specializing in public health and plumbing over here! I studied Earth & Environmental Engineering in school but have been working in arch./eng./construction for the last 4 years.

Very into building engineering at the moment but would like to cultivate financial freedom via buy and hold multi family properties and an occasional flip.

Hi all,

I’ve been listening to the podcast for about two weeks and I’m hooked! I think I may have found my first deal.

It’s a two story 4/2 home zoned as multifamily, but currently being rented by one family. It is more lucrative to turn it into a duplex, so I would need to add a second kitchen. It’s in a class B neighborhood and has a brewery, coffee shop, and pottery studio within walking distance of the home. The tax valuation of the home is current and up to date. Here are the numbers:

4/2 SFH to be converted to (2)-2/1 MFH

Purchase Price: $100,000

% Down: $10,000 30 yr fixed; 3.504%

Taxes: $4995/yr ; $416/mo (valuated based on a property value assessment of $138k in 2018)

P&I: $404

Property manager: $150 (10% of current rent I’m assuming)

Insurance: $35

Mortgage Insurance: $47

Monthly Payment: $1052

Utilities: Tenant pays all! However, home is heated with oil. The tenant is responsible for filling the tank.

Comps: $1100-1300/mo (current tenant pays $1500 for whole house)

ARV: appears to be .72 based 2018 assessment

Even if I assume the current tenant stays, I believe I would still be cash flowing $448. Realistically a bit less to allow for maintenance, etc. If made the home into a multifamily once more, I would be cash flowing around $1000.

Moreover, neighboring homes are estimated to have a value of $140k-$160k. In many cases they have one fewer bedroom. This seems to be a great opportunity for a favorable cash out refinance and a big step to a next property!

After a call with the realtor this morning, I was informed that though there are no photos, if I can send proof of finances, we could go see the place this weekend. I would like to have the home inspected to verify the life left on the siding, roof, etc.

I am not adverse to a project, and can see the post rehab light at the end of the tunnel. Assuming these factors aren’t a deal breaker, I would like to keep the existing tenant while I raise capital for a renovation to bring it back to a duplex. I see no reason to rush if it’s continuing to cash flow during this time. It would give me time to find a reputable contractor and accurately budget the repairs I will do.

Considering that the property comes with an existing tenant, an existing property manager, and is oil heated, is it a liability? Should also mention that the agent who I called regarding the property is also a buyer agent. Do you typically bring in a seller representative?

I did not expect for the real estate bug to bite me so quickly and would have never thought I would be trying to buy right now! I have yet to pre-qualify myself for a mortgage so plan to do that today. Hopefully this will light the fire under me to buy soon even if this deal doesn’t work out.

Am I crazy, or have I found a deal?? Would also appreciate any input on next steps I should take in this process, specifically regarding an out-clause pending inspection, etc.