All Forum Posts by: Christopher J Lemmon

I have noticed stuff popping up in there. I think there probably are deals in there. So many people are on facebook it makes sense that wholesales would list stuff on there. I have not made an offer on one from there, but I have thought about it.

Thanks! What's your source for the insurance cost? I have a REI Guard and is $1057 for replacement cost, up to $160,000.

Do you have a suggestion for better insurance? 

Here is my latest deal. After waiting for two years for another duplex in my target zip code to come up for sale, I was pumped when one did for 80K even though it needed some work. I bid over list the first day it came on the market. 

So I decided to start a new strategy, look for a single family home rather wait for another multifamily 2-4 unit to come up for sale. 

Here is what I found in my target neighborhood. 

SFR

List Price $69,500

1044 Barnett Ave,

Kansas City, KS 66102

List price: $69,500

3 Beds

2 Baths

2,414 Sq Ft

Currently Tenanted at $900/month for the next 10 months

The estimated life left on the roof is 5 years. All the appliances are relatively new 1-5 years. 

The house is C4 - functional but it does show signs of wear and tear. The tenants like the house and want to stay.

Finance - 80% LTV

Down Payment - 20% 

$13,900 (DP) + $4400 (Closing Costs) + $360 (Inspection) = $18,660

Monthly Expenses

Management = $90

Repairs = $50

Cap Ex = $75

Taxes = $54.75

Insurance = $88.09

Vacancy = $75

Mortgage $307

Total = $739.84

Cash flow = $160.16

Projected Return = $1920/$18,660 = 10% Return 

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $69,500
Cash invested: $18,000

Bought occupied rental as a buy and hold investment.

What made you interested in investing in this type of deal?

It’s pretty straight forward. I keep the rent the same and raise it later. No rehab, no major changes to the property. Just buy it for the income.

How did you find this deal and how did you negotiate it?

MLS

How did you finance this deal?

Conventional

How did you add value to the deal?

I will put some improvements in later.

What was the outcome?

So far it’s been good.

Lessons learned? Challenges?

It’s easier than you think.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

A real estate agent and a good inspector.

Nice job!! Your a baller man!! Thanks for sharing about your success!!

You may want to look st REI Guard out of KC if they insure your market. I too was paying very high insurance until I found them. So far they have been good for me.

Jay Helms - Yes, I am thinking may partner would be my brother, if can talk him into it and he would have the loan on his credit too. So it would be co-owned. But in that scenario I am trying to think through what is fair if one person puts down the down payment one supplies the credit on the application, and one person prices the deal and organizes the buy. How do you value those aspects fairly?

I agree. Positive cashflow is achievable in some markets and not others. 

I wish I was in town! How many people usually show up to these? 

I am a part time investor with a specified niche aporoach. I buy 1-4 units properties in Wyandotte County KS where I used to live. I know the community, rent rates, and housing prices. I turn them over to my Dad who still lives with 2 minutes of my target neighborhood and he manages them for an agreed upon percentage of the rents for total management. I am able to be out of town and hands off except for large repairs after the purchase.

I want to buy more buy and hold duplexes, but I recently lost my W-2 job. I have cash set aside for reserves and a new down payment and I will maintain on my other rents until I pick up a new gig.

I am curious what other investors have done in this kind of situation if they want to keep buying.

I have 3 brothers who l could be partners on an investment. Teo live in a market with crazy high standard of living costs. So housing prices in KC sound like child’s play to them compared to where they live.

I need a partner to take out an investment property loan mortgage to do another duplex or triplex or fourplex since I don’t have the W-2 income to get another one right now. I see several deals I want to make a move on, but I am unsure how to fairly structure a deal. If one partner is putting his credit on the deal to make it fly with the bank but I put up some or most of the down payment, what’s a fair split on the rent profit at the end of the year?

What’s credit worth?

In short what should I offer if the other partner is just using his credit to make the deal with me? 75\25 split? 50/50 or 80/20?

What does the seesaw look like? If I put up all the down payment, what should I cut them in for?

Also, I am the knowledgeable one in the family pricing the deal and showing them how we evaluate each potential investment, what’s that knowledge worth?

Anyone else who has done partnerships have thoughts?

I am only considering doing this with my immediate family as partners, my brother/brothers and Dad as manager since he is already managing all of my units.

Here is the scenario: 

Price: $78,500

Property: Duplex 2 unit, urban setting. 

Downpayment: 25%, $19,625. 

Closing costs: $4200

Seller Concessions: $3000

Rents: monthly $1300

Management: 8%, $104/monthly 

Repairs: $50/monthly

Cap ex: $125/monthly 

Rehab: Zero, property is occupied and tenants want stay. 

Mortgage, Taxes, Insurance: $550

Cashflow: $1300 - $550 - $125 - $50 - - $104 = $471

With a partner this could be split 50/50, 90/10, 80/20, 75/25? 

What would you do if you partner put up half the Downpayment or less but we used their income and credit? Or less? Or not down payment but we used their credit?