All Forum Posts by: Michael Baldwin

Thanks,
That does give me a little more to think on. My goals are to buy and hold, and rent out. I could use the monthly income from the rental, but I am looking further down the road and having properties to sell to help pay for my kids' college and stuff. But, if I make a nice monthly income in the mean time, that would be great.

I thought locating properties for investors would be a way to bring in some cash for down payments and such. Sounds like this would be best done if I lived in a bigger town, so I could go visit the property in person, and not rely on others. Right now, there is only one house for sale in my town, and it has been for a few years now. The owner does not want to sell, but her kids want her to, so it is priced about twice what it is worth.

Well, I will keep reading on here, and asking more questions as I think of them.

Thanks,

Hi,
i need to raise some cash for my first deal. Is starting out as a birddog a good way to do this? I do have time i can spend research properties and such. On tips on getting started this way?

thanks,
michael

Hi,
Here is my first attempt at analyzing a property. If anyone would care to give some feedback, it would be appreciated.

Property Description:
2 building 9 unit apartment complex located in a downtown area of a Midwest city with inter-state, water, and rail transportation systems in place.
The building is about 40 years old, but has been maintained very well.
Building is 11750 Square foot
The lot size is 16350 square foot
New roof
Updated interior
hard wood floors, crown molding, and French doors.
Units: 5 3 br, 3 2 br, and 1 1 br

Gross annual rent $55620, 1 3 br is vacant, rent would be $750 per month.
Asking price $400,000.00
Seller agent claims NOI is $43200 per year, with taking in to account the one vacant unit
So, if NOI is correct, the cap rate would be10.8.
Using the 50% rule the cap rate would be 6.95.
Assuming the complex was full, the cap rate, 8.08.
Not sure who pays the utilities, I am still waiting for the seller's agent to send me more info.

Cash flow:
Gross rent $55620.00 with current vacancy.
Expenses 50% rule $27810.00
Per unit $257.50 per month
NOI $27810.00
Seller is willing to finance 80% at 7.5% over 30 years with a balloon payment in 5.
P&I $26849.88
Leaves $960.12
Or $8.89 per unit per month

Now, I am just getting started, so I have exactly no cash to put in to a deal, unfortunately.
Assuming similar terms for a loan for a 20% down payment, but with a 9% interest, that would be a payment of
$643.70
Per unit $71.52
Net cash per unit of $-62.63

At the asking price of $400K, I think this property is over priced. Even if a person found a loan with 6% interest, and had the cash, the P&I would be $23022.72. For a per unit cash flow per month of $44.33.

I think I would like to see the property for sale at around the $300k mark, or a little less.

Any thoughts on my analysis of this property? I hope to attempt a few more property analyses, to practice of sorts for finding my first property to actually put an offer in on.

Thanks,
Michael

Hi,

You should be able to knock the hinge pins out to remove the door first, then remove the hinges from the door.

Sounds like you want to replace just the door, not the door and frame. For a replacement door, you just measure your current door, or opening, and the measurement should be 24, 26, 28, 30, 32, or 36 inches wide, and the most common height is 80 inches. If not, you will have to make a door, or have one made. The door blanks do not have hinge notches or holes for the door handle, you will need to install that your self. The mortises for the hinges can be done with a sharp wood chisel and a hammer, and for the door knob, you will need a hole saw for the drill, and a spade drill bit. This can take some time, and it can look bad if the hinge mortises and door knob holes are not put in the right place the first time.

If you can get the trim off around the door, I would just go with a pre-hung door. They range in price from $30 or so for hollow core on up to several hundred. My favorite are the 6 panel oak pre-hung doors, usually around 100 or so. They doo make hollow core panel doors to that are cheaper, if you want the panel look, but don't want to spend the money on solid core doors.

Good luck.

Curtis,

Thanks for the welcome. I have already found a load of information on BP, and I am sure I will learn more. Capital is something I am definitely short on, but I suppose if I find a good enough deal, the money will be easy to get. I am sure there are great deals all over the country every day, but for now I am going to focus on Nebraska and Iowa properties. It is kind of my comfort zone I suppose, and we travel to visit family, so if I can deduct a little of our traveling expenses because I am going to check on my properties, that is even better.

Michael U,

Thanks for the welcome. Seems to be a lot of Michaels on here.

Kevin,

Hi, thanks for the welcome. Omaha is one of the cities in range for me to look at properties at, but I think I am going to avoid it for now. I don't get there as much as I do other cities, and for my first deal or two, I think I want to go visit the property and check it out once in a while.

Hi everyone. I am Michael from a small town in central Nebraska. There is not much for real estate investing going on here, but I am less than 200 miles from decently sized places where I plan to look for real estate opportunities. I am a stay at home dad, so I spend a lot of time with my 3 kids and dog, while the wife goes out and works.

I have been reading about real estate investing for a few years now, and I think I am ready to take the next step. Looking for deals and starting putting what I have learned to practice. I have written the purchase agreements and did the negotiations myself on the 2 houses we have bought, and sold the one house without an agent. It was a learning experience, that is for sure, but I am glad I did it that way. It aloud me to gain a little more confidence for when I am ready to take on real estate investing for profit.

In the short term, I would like to own one rental property by the end of 2011, and maybe 2. The problem first is coming up with the cash for the deal. Or maybe the problem is finding the deal. I think I have located a few different options, but I won't go in to them here. I have decided to focus more on rental properties, mostly multi-family units, for a little extra cash flow, and for the equity that I should be able to cash out on in 15-20 years, when I need to start paying for college and weddings for my kids.

I hope to make some great connections here and gain a wealth of knowledge. Eventually I hope I will be able to contribute more than I get, but I guess we all have to start somewhere.