All Forum Posts by: Kyle Garro

We have a new development home in Wisconsin that we’re buying appliances for. Do any of you experienced developers have an allowable amount for appliance purchases. Meaning if your home costs 100k to build, appliances should be about x% of the total cost. Or do you go off of the anticipated purchase price? Thanks and happy thanksgiving!

Hi all, i am looking for a way to find sales volumes by zip code and city. Also, how long homes stay on the market, average sales price. General information like this is hard to find without reaching out to a broker but is there a way to just find it through some sort of portal without going to an agent or broker? Many thanks for your help folks.

Didn’t know these happened in Madison. I’m out of town for this one. When do they usually happen?

Originally posted by @David Worker:

Distressed properties- I drive around and look for properties with overgrown grass, overstuffed mailboxes and other signs of neglect
Code violations- municipality
Tax delinquent- county
Inheritance list- usleadlist.com
Probate sale- county

I got these list ideas from episode 176 of BiggerPockets Podcast with Tom Krol. He goes through the 9 lists he uses for direct mail. It’s a great episode!

 Awesome info, thanks!

Originally posted by @Ron Fletcher:

Is this deal even gonna cash flow anyway?

 If I bought it for 300k I would have positive cash flow. It would be below my 10% yield I am shooting for though. I have no idea about the condition of the property though so that will have to come out in the inspection. I’m worried about cap ex killing my cash return throug year ten, butnwont know specifics until I get the inspection done. 

Originally posted by @David Worker:

The MLS in Springfield, IL isn't that thrilling to me. When I'm ready for another property, I will probably direct mail some properties that are distressed. I would like to find lists of pre-foreclosures, tax delinquent properties, probate sales, code violations, and inheritances and contact them too.

 Do you reach out to your local county court for the pre foreclosure and delinquency information? How would you find the other types of distressed properties you highlighted? 

Originally posted by @David Worker:

It depends on how motivated the seller is to unload this property. If they’re tax delinquent, preforclosed on, trying to make a quick sale for a 1031 exchange, or any other scenario that would make them highly motivated, then your lowball might be enough to make a deal.

Unsure of the sellers motivations but this is a good angle to look at the deal from. Is the landscape tough for everyone? I am in the middle of Wisconsin and prices seem crazy here even.  

I am interested in putting an offer in on a property. The current rents can support 2800 gross per month for all 4 units. C class unit with some deferred maintenance that will have to be addressed on a ten year time line. Asking price is 335k which is high by about 35k at least in my opinion. My question becomes, do you place an offer that is much lower than the asking price and just see what happens? Or do you talk to the agent first to see if it is even worth it? I don't want to make any enemies as this is a small market but the prices i am seeing are just way over the 1% rule and honestly don't make any sense as i run the expenses on some of these properties. As a general strategy, is it poor form to throw in a low ball offer or place an offer with the intention of finding something wrong that will allow you to retrade the deal (i know this is questionable)? Really tired of just passing up deals because the numbers just don't make sense and want to start getting in the game. Thanks in advance for the help, all.

Thanks for your input, its appreciated. I just don't have the time to look over all of the properties in both cities, so i was looking to consolidate my search to a few zipcodes which would allow me to become an expert in those areas rather than have a little bit of knowledge about the general area. Hearing from everyone has been helpful though. I am ok with whatever price i have to pay, as long as the property is a b property and cash flows well after accounting for expenses, so cost is not a limiting factor as long as we are under the 1-2 million mark. How are you best finding deals at this point? It has been my experience that this is the biggest trouble, finding deals that makes sense, it seems like everyone is asking a premium.

Originally posted by @Keith Schulz:

Hi Kyle,

It depends on what you are after as to what locations you should pursue. If you are willing to cover a broad area from Milwaukee to Madison, I'm not sure why you'd focus specifically on one zip code. I'd focus on finding a good deal. The good deals are few and far between in the Madison area lately, so being flexible in location can certainly offer some benefit. From my experience many areas of Milwaukee have been much better cashflowing than Madison, but I like the Madison market better from a long term stability and appreciation perspective. It  all depends on what you are after and what your goal is though. 

Hello all, I am a what most would call a newbie (developed two properties and sold on speculation, but no multifamilies owned) but i would like to get into the multifamily space. I have a fairly good idea how to analyze a good deal or not by the numbers but i am having a hard time determining where to look. I am in between madison and milwaukee (wisconsin), which are both decent markets. My question is, how do you pick zip codes inside of a market to focus on and how many do you focus on if you have a town of 230,000 people (madison) vs. 600,000 people (milwaukee). I don't want to look at the entire city, I just don't have the time so i want to focus on a few zipcodes, become an expert there and grow that way. Any one have an idea of how you pick zipcodes and how many you should be focusing on if you have the population discussed above? I am looking for b properties or maybe c with some value adds, if that helps. Thanks for any help folks.