All Forum Posts by: Michael De Rosa

That Is not a simple question to answer without knowing your goals. Are you looking for long-term or short-term hold, do you want work or a turnkey property, multi family or single family, do you want to leverage or only use cash, what part of Salt Lake County are you looking to buy it, what type of neighborhood I could go on.

Appreciation is going to depend greatly on the neighborhood. It also depends on the type of housing in a particular neighborhood.

In nicer areas it will be harder to cashflow a SFR since most people are not buying them based on their income potential.

A multiplex will usually be easoer to sell in a pinch for a better price.

You will notice that areas that tend to have greater appreciation will have lower cap rates so your monthly cash flow will usually be lower.

When running your numbers you need to calculate the cost of repairs too. Based on the price in WVC your assessment of a C neighborhood is probably correct. You will tend to get more cash flow since you get less appreciation on average on that area.  

What type of repairs are required, how many other duplexes are in the same area, what would be the rent after you fixed it up, are there transit stops near by, do you plan to occupy one side, and how long do you plan to stay in this deal?

Your observation is correct. There is a lot of cap rate compression in our market and it can be difficult to find a property that cash flows unless you are putting down a larger down payment. There are deals out there but you have to be more creative if you want to stay in the Salt Lake area. Renting out a SFR as 2 units could give you more cash flow but you do not see the appreciation in the building you would normally see in a fully permitted multiplex, especially if you end up putting in capital to remodel the building. There are also more headaches like utilities, parking, and neighbors that you have to consider.

What are your financial goals with the property you plan to buy?

@Matthew Shay Sounds like you could have a good deal if you can get a release from the current tenant. I would keep calling them every day until you get someone who can help you at Kroger. Do you have the full text for the deed restriction?

@Tonya Thompson There are too many things that raise a red flags, no paperwork up front, no real estate agent, no title company/attorney, closing at a restaurant, seller financing on an REO.

Based on the info given to me in this thread, I would be very cautious about a potential scammer.

To add onto what @Wayne Brooks said:

1) I have never heard of an AM with an REO approving a seller financed deal.

2) Something sounds off about the whole transaction to me.

@Tonya Thompson I would want to go through a title company and have them pull a title report before I purchase any property. 

How did you find out about this REO? Is the AM working with a licensed real estate agent in the local area? Are you working directly with the AM or the agent? Where is your earnest money being held?

That will depend on the terms of the REPC and the rules of the MLS. For example, in my MLS, if we have an executed extension we are still Under Contract and the listing should reflect that. Does that answer your question?

@Matthew Shay One option would be to advertise the land for lease and say that you are willing to build the building to the tenant's needs. If time is an issue you could put up a building with a vanilla shell that they could then build to their own needs. Another option would be to just land lease the lot and let the tenant do what every they want with it.