All Forum Posts by: Kyle Kelley

What is your take on maintaining strictly "cash reserves" to cover any repairs versus using a LOC and then paying it down?

I ask because I am contemplating whether or not I should continue building cash reserves while maintaining and paying down LOC little by little or just use all of the cash I have to pay off the balance on the line and then dip into it again should I need to make a repair or cover unexpected vacancy / expenses?

I would still continuously be striving to build a cash reserve for the long haul, but given the current circumstance I almost have enough cash to cover the line but then I would be out of cash.

Any and all input would be greatly appreciated.

@Joel Owens 

What range would you expect to pay for a smaller, like 5 or 6 unit multifamily apartment complex appraisal? I know you mentioned "thousands" of dollars but I was thinking that applies to larger complexes like 30 or 40+ units, but wasnt sure if "commercial" appraisal rates truly start at anything 5 or higher

@Ben Leybovich

I was wondering if you have any insight as to what cap rates would be for multifamily/commercial apartment complexes in even smaller towns? Like say around 15,000/10,000?  

I know there are a many small towns near Lima like Delphos, Van Wert, Bellfontaine, etc. , do you have any familiarity with those areas or any idea of what to expect cap rate wise in those types of towns?

Hi everyone, 

I'm looking for some help and have questions about the best way possible to go about calculating the cap rate for a multifamily/commercial apartment complex located in "Small Town, USA" 

I am interested in an apartment complex that has 10+ units, and have some rough estimates of the expenses and income figures (the seller is not giving too much information until EMD and agreement signed, so I am working with ballpark figures) but I am trying to find out the best way to calculate a cap rate for a property like this. I have found very little in terms of researching online, any recent comparable sales of multi family/commercial sized apartment properties in the area and I am not sure how the smaller population affects the potential figures.

If any of you have had experience buying in these types of areas, small towns with populations of 15 to 10 thousand, I would really appreciate any help and feedback. 

Thanks!

@Bill Exeter  Is there a minimum amount of time the previous property needs to be used as an investment property? Does it need to be an investment property immediately preceding the transfer? Also, is there a minimum/maximum amount for the 1031 exchange? 

Sorry for all the questions but figured I would just put them all out there :)

Thanks will do! 

Thank you @James Wise !

@Dan DeMott  So if I understand correctly that means the checks are made out to your/your companies name then? I apologize for my lack of understanding the terminology but just want to make sure I am understanding correctly :)

@Beth L.  Yes, I have a company and that is what we have tentatively agreed to (they take care of basically everything - running bigger repairs by me first but other than that basically everything at their discretion). Just want to make sure that putting the rent checks in their names is not a silly thing to do - we will have a contract that outlines everything, but again, its technically my first rodeo here with PM so I figure better to be safe than sorry  :)

Hi all, 

I've been scouring the archives to try and find this answer but I have yet to see it - I'm hiring a property manager for my out of state investments, so should I have my renters make checks out to the property manager / property management company name? Then once checks and cash are collected the property manager takes out their fee and sends me a check from the PM company for the remainder of the balance? 

Or should I have the rent checks made out to me (the owner) and cash forwarded to me either in form of money order or check in the amount of cash from the PM company, and then I get billed and make a payment to the PM company for their services? 

I don't mind doing either, I just want to make it as smooth and easy as possible each month so wanted to gather some input as to what you feel would be best.

Thanks!

@Dan DeMott  When you collect rent checks/cash do you have the checks made out to you and then you take your fees out before sending the total amount to the owner? Or are all the checks made out to owner, cash collected, and then sent to the owner along with a bill for your services? 

I ask because I am about to sign on with a PM and I want to make it as smooth as possible, without checks and cash being sent back and forth so much, but just wanted to gather a PM perspective on how to handle that. 

Thanks!