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All Forum Posts by: Kyle Woodruff

Kyle Woodruff has started 9 posts and replied 32 times.

Post: CAP RATES for evaluating a properties value

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

I appreciate the feedback that's why I come to the pros to help me figure it out... I am happy to rerun my number because I knew I had to be off..and electricity is paid for by the tenants, so I didn't factor it in with expenses 

Post: CAP RATES for evaluating a properties value

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

Hi Everyone I hope all is well

I am in in a tough spot. I am trying to determine what my property would be worth if I raise rents and do some value adds. But I'm coming up with a number that is way higher than I deserve for the potential evaluation of my property. 

here is how I see it in my head and please correct me where I am wrong: 

properties surrounding the auburn area for 2 bed 1 bath are on average for 950. If I put the two bed 1 bath rents for 800 that is 2400 for those ...the studio I am adding will be another 650

So 3150 for apartments ..
With 13 storage units at 55 that is 715 a month but I am adding a larger 14th unit that I will rent for 150 but let's say 100 bringing the total to 815 for storage

So 3150+815 =3965

In a cap rate appraisal you exclude the mortgage, tax, insurance and cap Ex

So expenses are ..
Heat 200
Water 75
Trash 75
Landscape/snow 75
Repairs 120
Vacancy 120
Miscellaneous 200

That's 865 in expenses but let's say 900

So 3965-900= 3065 in profit (noi) x12 months in a year=36780

You divide that by the market cap rate..which I am going to use the most recent data of 7.45%
36780÷0.0745=493,691

can't be right. No way...someone please save me from myself ...thanks everyone

Post: Newbie first purchase

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

Hey Bruce ..you have an awesome last name BTW lol. Yeah market rate is around 950 in the area but my comps are more in the city and I am about five minutes outside the city so I'm going lower. 

I agree the value add is high. I am looking into buying a rental box truck to rent out as well. 

Property is I'm distress but it is a commercial property so I want to squeeze every dollar I can out of the property

Post: Newbie first purchase

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

Hi Everyone, 

Just closed on my first deal and to say the least I am freaking out. It's a unique property so it was a real shot in the dark on how to evaluate the property. Even harder because the property was poorly managed and rent was way under market. 

Property has three units with two rented out for 600 and 500 a month.

Property also had 13 storage units on it that rent for 45 each.

My plan: Raise rents to 800 a month for two bed 1 bath units.

Create a studio out a bonus area and charge 650/month.

Use the garage as more storage and charge 150 a month for storage in that

Raise rents to $55/month in the 13 storage units. 

Bought the property on land contract for $105,000. 

What am I missing or not considering. Thanks everyone for taking the time to help out a newbie.


Post: Cap rate and evaluation help

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

Thanks for the reply @Paul Moore I have been watching your videos and then rewatching in case I missed something. I am on the hunt to fund people in my area. Finding someone to learn from is crucial! Thanks again for the feedback!

Post: Cap rates in certain areas

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

Thank you for the responses.  I know the supply for housing in our area is very sought after.  Supply of houses cannot keep up with the demand. 

Post: Can't qualify for a loan but have the money

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

@Brian Wilson

I would listen to Pace Morby on YouTube. The guys a genius with creative financing. All sellers think they want all cash offers, your job is to convince them they really don't. If someone is wanting to get 100k for a property and an "all cash" buyer comes in at 100k. The seller initially thinks how cool it is that they got asking for the property. But after closing cost, title fees, and waiting around for inspections, appraisal, etc. They may come out with only 85k.

You offer them the 100k but then tell them instead of paying closing costs and going through a buyer with a bank, they become they bank, get a good down payment, collect interest for however long you set your balloon payment, don't pay closing costs, and don't pay on the big capital gains taxes right away.

They now have there asking price of 100k earning them money with the interest, don't have to pay big taxes on the money they earn, and will probably end up getting over 115k depending on when you pay off the balloon.

Everyone wins!

If it's a subject to deal then you can take over their existing loan and improve their credit while they also get paid for the sale of the property.

Post: Cap rates in certain areas

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

Anyone have a way to look up cap rates in a certain area? I'm trying to get an evaluation on the property I want to purchase and can't find how to look up cap rates in my local area. Thanks in advance everyone!

Post: 403b to IRA for Real Estate Investments

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

@Justin Windham

Thanks again Justin! Looks like I am quitting lol. I will absolutely see if that is an avenue for me.

Post: 403b to IRA for Real Estate Investments

Kyle WoodruffPosted
  • Rental Property Investor
  • Rhodes, MI
  • Posts 32
  • Votes 6

@Justin Windham

Thank you Justin! Yeah I'm still currently at the same place of employment and that has been my hiccup with the whole thing. I guess I figured I should be able top move my money wherever I want lol

Thanks again Justin