All Forum Posts by: Matt J.

@Kimberlee Kennedy I've thought about this question before. I have a real estate license myself, although I don't do it full time, and have considered joining an investment minded brokerage. The way that I've found them is searching the MLS and seeing what agents/brokerages have all the flip listings. In my market there are several smaller/independent firms that are are heavy on the flip listings which tell me they work with investors. Good luck!

Joseph Welker commercial will likely require 25-30% down. I believe the comment about VA not allowing 5 units is correct as well. Best of luck, where there's a will there's a way.

One FSBO off Zillow and another off Craigslist

Hello BP Community,

I'm in need of a licensed, bonded and insured electrician who works in the NE Tacoma / Fife Heights area. I have a project where I've demoed several soffits and need the can lighting that was in them properly terminated. Everything is open and exposed. 

Any referral would be appreciated.

Thank you!

Thanks to everyone for your feedback. I do agree that I may be a bit optimistic in thinking that I'm going to get 4% 8-12 months from now. I run my numbers at 4.5%. Thanks again.

Rudy Manna I agree that it's much easier to purchase existing MF. My challenge has been finding something without a ton of deferred maintenance and at an acceptable cap rate. I also want something newer which tends to mean that each unit will be metered separately for utilities. I've built one home (used a builder) before and done several flips. A concern I do have is no matter how much planning and prep goes into it the costs always end up being more than expected. As an added bonus the location is 10 minutes from my primary residence.

Hello BP

I have a new construction MF deal I'm looking at. I'd like to ask those that are familiar with MF for their feedback on anything I may be overlooking.

Location is in downtown Puyallup, WA. This area is East of Tacoma WA. I'd be purchasing 2 fourplex lots and 1 duplex lot and building a total of 10 units. All three lots are next to each other. Being that these are on their own tax lots and 4 units or less it would allow for traditional financing once the construction is complete. It would also allow me to sell one building at a time should I chose.

Each unit will be individually metered for utilities.

Here are the numbers:

Cost of land and construction, all in, $1,180,000 (verified with experienced MF builder)
Down payment 230k
Loan amount 950k
LTV 75%
Interest rate once buildings are completed, rented and refinanced out of construction loan, 4%

GSI for 10 units $11,850
Monthly expenses
Vacancy 5%, $592.50
CapEx 2%, $237.00 (low due to new construction)
Garbage 5%, $600.00
Management 7%, $829.50 (verified with local prop mgmt co.)
Taxes 8%, 958.33
Repairs 2%, $237.00
Electricity $50
Insurance 3%, $300.00
P&I 38%, $4,535.45
Total $8,339.78
Monthly cashflow $3,510.22 / NOI $96,548.00
Cap Rate 8.18%

What am I missing? Anything else I should be taking into consideration?

Thank you

Hello Adam, I'm sure you're already planning on doing it but make sure you really review the strength of the homeowners association. You should be provided a resale certificate for your review/approval. Be on the lookout for any lawsuits, big ticket items coming up that may require a special assessment and amount of reserves the association has. Good luck!

@ David Dachtera are you referring to FNMA's DU 10.0 release and the inclusion of trended credit data in their decisioning process? If so DU 10.0 has been delayed until further notice. If there are other major changes I'd love to learn about them, due to my location I wouldn't be able to attend. Thank you.

I met and spoke with Twinstar Credit Union about this very question two months ago. They will finance construction on MF up to four units. You have to fully qualify for the loan and be able to make the monthly payments during the construction phase. They will allow you to use your paid/or partially paid for land as the down payment. Their rates seemed fair as well. Out of curiosity are you doing the build yourself? If you need more info we can take this offline - good luck.