All Forum Posts by: Matt VanGorder

Thank you for the insight @Wale Lawal

Good afternoon BP - 

I am going to be closing on my third duplex in a few weeks and I am starting to think about and plan my next purchase. I am considering making the move into commercial properties, most likely 5-10 unit. For anyone who made this transition, what was the biggest difference? What should I watch out for? What are some of the challenges I could face and how did you overcome them? 

Appreciate the insight! 

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $135,000
Cash invested: $43,000

Up/Down duplex. Lower level is 2 bed and 1 bath. Upper unit is 3 bed and 1 bath. It is currently vacant. Will bring at least $500 after expenses at a CoC return of 14%. Rents should bring in $1800-$1900/month.

I know this can be property by property but assuming all major mechanicals are in order and a B-C neighborhood....

With interest rates being at the highest levels I can remember, if a property cash flows and brings a single digit CoC return, does that make it a buy? Hypothetically, let's say a duplex cash flows $150 after all expenses (vacancy, capEx, maintenance, etc) at a 6% CoC ROI. The rents are under market by $150/each. By raising the rent on each unit, it turns into a 10%+ ROI. When rates return, you should be able to refinance and improve the CoC return to the high 'teens or low 20's. With everyone, including most investors pulling back, is this actually a good time to buy?

Thanks @Jeremy Taggart. No issues or concerns with Beaver Falls? I've heard a couple areas can be difficult with code/inspections. 

Anyone have any experience with multifamily in Beaver County? I am wondering about areas to avoid. Aliquippa? Beaver Falls? Baden? Also areas to target? Thank you!

Anyone have any experience with multifamily in Beaver County? I am wondering about areas to avoid. Aliquippa? Beaver Falls? Baden? Also areas to target? Thank you! 

Is it better to wait for an overpriced house to sit before offering a lower price or is it better to make a quick offer even if it is 20% under ask? I am looking at a duplex priced at $130k. I got a first look right before it hit the MLS. I believe fair market value is closer to $100k. Should I make the offer before anyone else can see it or wait until it sits so the sellers can potentially get some feedback that it is overpriced?

Is it better to wait for an overpriced house to sit before offering a lower price or is it better to make a quick offer even if it is 20% under ask? I am looking at a duplex priced at $130k. I got a first look right before it hit the MLS. I believe fair market value is closer to $100k. Should I make the offer before anyone else can see it or wait until it sits so the sellers can potentially get some feedback that it is overpriced?

Appreciate the insight. Congrats on your success @Randall Alan

Great questions @Jacob St. Martin. I do not need the cashflow currently, but I would love to leave my 9-5 eventually. I am relatively new in my real estate journey. I just purchased my first two duplexes earlier this year. Really good point about only having one roof and essentially less capital expenditures to worry about.