All Forum Posts by: Karla Torres

Thank you all for the time you took to look at my post this was all very helpful! @Bill Horton I was provided with a spreadsheet with the names of the tenants and payments. I will definitely be asking for the actual leases, P&L for the previous years and any additional expenses. @Rafael Mendez Your questions have made me want to dig a lot deeper and question myself as well. Working on them already! Thank you.

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Thank you @Wayne Brooks What are some of those other expenses that I might incur?

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@Sam B. These are the numbers from the Schedule E taxes for repairs and utilities. If we include taxes and insurance to the expenses then it will be an additional yearly 12k.

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Good morning! I need some help with evaluating this commercial property. This is my first commercial property and just want to have opinions from experienced investors. The property is 12,000 sqft, it is 100% leased with 3 year leases in place. Rents received for the year is $118k. Yearly expenses (utilities/repairs) $6k. My calculated Cap rate is 11% Seller is asking $1M.

I will get a lender and finance this deal and put the required downpayment. What are your thoughts? Thank you in advance for any help!

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@Christopher Phillips yes I have been to the house twice and it is pretty much in good shape but of course I do not know of any damages not visible to the eye.

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Originally posted by @Patti Robertson:

@Karla Torres - This is not a potential flip at these numbers. My guess is you are looking at comps that sold this past spring and summer, and the market now has slowed down considerably, especially in the high priced arena. Like @Christopher Phillips, I agree that if the house was appraised, that's where you ARV is. It sounds like you didn't really have it appraised, but were using RPR, which did not know your property condition. Most likely in that price range, it was comparing your home to houses in perfect condition. Be very, very careful in this high price range.

Thank you for the honest feedback and taking the time to help me out. I greatly appreciated your advice.

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Originally posted by @Joshua S.:

Originally posted by @Karla Torres:

Thank you so much for your help and insight. I will take another look with the 670k using the calculator and see if it's worth it!

Originally posted by @Christopher Phillips:

@Karla Torres

Of course... Welcome to BP!

If they are in a pinch, they are using what would be considered 30 day pricing. Essentially low enough that it should be under contract within 30 days. It usually would be that low. But, desperate measures for desperate times. I would expect the price to bid up rather quickly unless there's a hidden issue you might know about.

"IF" the $662K number is good, let's say +/- 10%, then your ARV with some paint and tile work won't be much higher. Maybe $670K to $680K.

When doing flips, the profits come from getting the property at a deep discount, like with this situation, and managing rehab and carrying costs. Outside of that, it's hard to get $1 for $1 increases in ARV. Depends on where you put the money.

If you can lock it up, even at $600k, put in the paint and tile work needed, you could get $670k to be safe and still have a decent gross profit.

You should use the BP calculators or a spreadsheet and look at where your max offer price might be.

Also, just a BiggerPockets user interface tip, when you reply using the "quote" feature, you want to type your response below the quote. Otherwise, it can cut off your response, because the quote gets rolled up. If you type under it (you'll notice it's not italicized) then it will show up where this one does. Good luck on this endeavor, I hope it all works out!

Great tip! Thanks!

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Thank you so much for your help and insight. I will take another look with the 670k using the calculator and see if it's worth it!

Originally posted by @Christopher Phillips:

@Karla Torres

Of course... Welcome to BP!

"IF" the $662K number is good, let's say +/- 10%, then your ARV with some paint and tile work won't be much higher. Maybe $670K to $680K.

If you can lock it up, even at $600k, put in the paint and tile work needed, you could get $670k to be safe and still have a decent gross profit.

You should use the BP calculators or a spreadsheet and look at where your max offer price might be.

1 Vote

Yes, my realtor ran the RPR mini report and these are the numbers we came up with. It is not a short sale, but they lowered the price because they want to sell now and cant afford next month's payment due to having lawyer fees and debt. The rehab that is needed is just paint and fixing some tiles and other minor miscellaneous things.

Do you think there is something fishy about this?

Thanks for your response! I really appreciate it.

Originally posted by @Christopher Phillips:

@Karla Torres

Maybe you can explain a few points.

Why are they selling it at $550K if it was appraised for $662K? Doesn't add up. What kind of appraisal is that and when?

Is this a shortsale?

Also, $10-15K in rehab doesn't get you that much of a boost in ARV. $10-15K is like a single bathroom or some interior paint and floors. You can't go from $662K to $720K with that. What kind of rehab is needed?

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Good evening, I am a new investor. Currently own a rental property in Virginia Beach and renting the MIL suite at the home I live in.

My friend is going through a bitter divorce, they are desperate to sell their home ASAP and selling it for cheap. I think it would be a good property to buy, flip and sell. The problem I'm having is funding the deal, which makes me think it might not be worth it. This is why I need some advice from the BP forum :) Here is the breakdown.

Home is being sold for 550K Appraised for 662K Minor rehab of 10-15k ARV 720-730k

The comps in the neighborhood have sold from 695-860k and taken an average of 52 days to sell.

The hard money lenders I have contacted want me to put 20% down, pay about 3 points, and interest of 12% +.

I'm worried that since it's almost the end of the year, the house might take longer to sell. Also, I will have to get a personal 40k loan to be able to pay the 20% down.

Thoughts? Is it worth it for me to do this? I would at least profit 30k if the home is sold in less than 6 months.

Thank you!

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All Forum Posts by: Karla Torres

Karla Torres has started 2 posts and replied 10 times.

Post: Off market 100% leased Shopping Center

Post: Off market 100% leased Shopping Center

Post: Off market 100% leased Shopping Center

Post: Off market 100% leased Shopping Center

Post: Would you buy this property? Need some advice!

Post: Would you buy this property? Need some advice!

Post: Would you buy this property? Need some advice!

Post: Would you buy this property? Need some advice!

Post: Would you buy this property? Need some advice!

Post: Would you buy this property? Need some advice!