All Forum Posts by: Mario Reyes

Investment Info:

Large multi-family (5+ units) buy & hold investment in Champaign.

Purchase price: $165,000
Cash invested: $175,000

Hello BP Family,

This is my first investment property in real estate—a great location, next to a high school, park, Kraft, and near downtown. I have partnered with someone with excellent construction skills, and we plan to renovate it completely. According to appraisal "As is" value is $185,000 and $600,000 ARV. I am currently asking tenants to move out and planning to start renovations in May 2022; looking forward to connecting and continuing learning with the BP family!

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

* Great location
* Multifamily
* Value add opportunity
* Partner with great rehab skills

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

- I became a real estate agent to be able to work directly on my deals.
- After the property sitting on the market for almost a year, we waited a couple of months after asking for financials and rent-roll to create some urgency (Seller lowered the price after four months). After inspection and re-hab cost estimation, we offered $160,000, seller counter with 170,000, countered again, and closed at $165,000.

How did you finance this deal?

My partner put in the downpayment, and I took the mortgage for a 50/50 split.

How did you add value to the deal?

I found and negotiated the deal as a real estate agent. I negotiate and oversee the budget and bids of the project. Also, I will manage the property and help as I learn with rehabbing.

What was the outcome?

We earned $20,000 instant equity with the acquisition, and we are now entering into the renovation phase as we wait for tenants to move out by the end of April 2022.

Lessons learned? Challenges?

- One of the biggest challenges has been finding and negotiating with architects. Big players around the area have been doing major renovations in the area.
- Negotiating with tenants to move them out of the property to avoid evictions while we find an architect to work on our project.

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

I was the real estate agent. Currently, I am looking for FHA and hard money lenders.

Wow, great for you! That could've probably been a lot worse. We gave our tenants more time as we now wait to start the renovation, so we are good so far. Thanks for sharing!

Investment Info:

Large multi-family (5+ units) buy & hold investment in Champaign.

Purchase price: $165,000
Cash invested: $175,000
Sale price: $205,000

Hello BP Family,

This is my first investment property in real estate—a great location, next to a high school, park, Kraft, and near downtown. I have partnered with someone with excellent construction skills, and we plan to renovate it completely. According to appraisal "As is" value is $185,000 and $600,000 ARV. I am currently asking tenants to move out and planning to start renovations in May 2022; looking forward to connecting and continuing learning with the BP family!

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

* Great location
* Multifamily
* Value add opportunity
* Partner with great rehab skills

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

- I became a real estate agent to be able to work directly on my deals.
- After the property sitting on the market for almost a year, we waited a couple of months after asking for financials and rent-roll to create some urgency (Seller lower the price after four months). After inspection and re-hab cost estimation, we offered $160,000, seller counter with 170,000, and countered again and closed at $165,000.

How did you finance this deal?

My partner put in the downpayment, and I took the mortgage for a 50/50 split.

How did you add value to the deal?

I found and negotiated the deal as a real estate agent. I negotiate and oversee the budget and bids of the project. Also, I will manage the property and help as I learn with rehabbing.

What was the outcome?

We earned $20,000 instant equity with the acquisition, and we are now entering into the renovation phase as we wait for tenants to move out by the end of April.

Lessons learned? Challenges?

- One of the biggest challenges has been finding and negotiating with architects. Big players around the area have been doing major renovations in the area.
- Negotiating with tenants to move them out of the property to avoid evictions while we find an architect to work on our project.

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

I was the real estate agent. Currently, I am looking for FHA and hard money lenders.

@Julie Hartman Thank you so much for the response! 

I bought a 9 unit multifamily with a partner, and we inherited some tenants with very basic leases; I'm not sure what you are asking me with; what is the month-to-month notice period on my lease? In Illinois, we have to give a 30-day notice to MTM tenants. Currently, we have three tenants left from nine that we started with that are supposed to leave by the end of April before we start renovations. I haven't seen information on what to do when you have a newly signed lease, and your current tenant decides to stay as a tenant at sufferance; I wanted to prepare and hear other people that might have gone through that so I could learn from it.

I appreciate your insights! 

Hello BP Family,

I just started managing my first investment property, and I cannot find the answer to how to handle holdover tenants and new tenant leases? If a tenant is supposed to leave by the end of the month and you have already found a new tenant and signed a lease, what do you do? Are we liable for all the damages caused by the new tenant's unable to move? Or is there something on the lease that prevents some liability? Please advise. Thank you so much for your collaboration!