All Forum Posts by: Maximus Decimus

Thierry, in the US, no you cannot offset property tax with the interest payments, however I believe there are some tax deductions you can have.

Does anyone else have any other advice on the property?

The $453 cashflow was using the 50% rule.

In reality if I manage it myself here is the breakdown I am looking at

Purchase Price: $500,000

$100,000 (20%) down - Loan amount $400,000

$5200 gross revenue - 7% vacancy ($346) = $4854

$4854 - $2150 (P&I) = $2704 - $916 (Taxes) = $1788 - $150 (Insurance) = $1638 cashflow per month. This is before any maintenance, etc.

They used granite countertops in the units. The units are above average for the area. Most other multi family properties are much much older (1980 or before). One of the reasons we looked at this building was that it is newer and it is in a good area (very good school district, good location, etc). It is located in a major city in Ohio.

Joel, sorry about the miscommunication, the owners did a condo conversion to separate out the units. As the owner I would not have to pay any association fees or anything like that. I think they did it just as an option if they wanted to sell the units individually.

I am going to check out the property to see the quality and condition of the finishes. I will also check to see how the water heater/ac units look as well - I will bring my contractor with me.

The agent did say that the roof is 5 year old. There was a very large storm that came through the area, a lot of properties roofs were damaged and insurance replaced the entire roof.

I am looking at a 5 unit townhome building (each unit has been separated in condos, each unit pays their own utilities). Each unit is 3 bed/2.5 bath and has a attached 2 car garage. Building was built in 1999, and well maintaned. 100% occupied and good rental history last 3 years.

Gross per month is around $5200

I may be able to negotiate down to $500,000 for this property. Using the 50% rule I calculated that this property would cashflow around $450 ($5200 / 2 = $2600 - $2147 (Principal & Interest @ 5% assuming $400,000 loan) = $453

One negative is that the property taxes seem to be high, running about $11,000 per year for the building. There is also maintenance with snow plowing and lawn care since the building is on a 3/4 acre lot.

How does this deal seem? Any opinions would be greatly appreciated.

So I think that if the loan is subsidized through freddie mac then the limit is 4 investment properties. If the loan is subsidized through fannie mae then is the limi 10 investment properties? We want to get the best rates and terms, however we want to be flexible in case we want to buy other investment properties.

So what happens if I go with this lender, use up my limit of 4 properties (since its backed through freddie mac), and then if I find another property to buy and I want to buy it through a fannie mae backed lender?

I own four duplex properties free and clear and am looking to do a cash our refi for 70% of the current value. I have been researching lenders, however I am getting conflicting statements on the property limit guidelines. A credit union I am talking to said that they insure their loans through freddie mac which only allows 4 investment property loans. However I have seen information online which says that you can now have 10 investment property loans under one name, so I am not sure what is the correct information here. Can someone set the record straight as to how many investment property cash out refis you can have under one persons name (not on a business, but personally under my name). Thanks!