All Forum Posts by: Michael Le

If the market is $600 then don't be shy about not renewing the existing tenants and just get new tenants instead. There is a good chance the current tenants can't afford your increase anyway.

It doesn't make sense for you guys to split the rents. You should be splitting whatever the net income is after all of the expenses and debt service. So if it is a month that has nothing breaking down you'll be sharing in a bigger pie. If there is an AC or roof replacement then there will just be less to split. You guys share equally in the profits and expenses.

 Sent you DM with company I used

Getting a feasibility study done (a few grand) will likely be best for you since you are new to it all.

You ask the Seller for it

I work with the president of the company. I will DM you the contact. 

Mayfair has done a great job for me there. They're Dallas based.

Potentially it could work but what do your competitors do? If all of they are doing all-bills paid then you might not be able to keep your occupancy by charging for utilities. Also, if the property is already non-cash flowing then you are likely missing other reasons beyond the utilities. Since you're new just be extra careful.

I think this is much to do about nothing. It's like getting up in arms over whether a REIT like Camden owns 65,000 units or if their share holders really do. Just mentally substitute 'owns' for 'owns interest in' whenever you hear someone say it and focus your energy on something more positive like getting more ownership interest yourself.

First of all, congrats. I've been reluctant to go down that path but it is definitely one of the hot redevelopment opportunities out there.

I'm not sure how seasoned this deal will need to be for a lender to put perm financing on there. I would imagine 12 months since usually it's based on 3 months of income and 12 months of expenses. Also, you say that expenses are $12k but they would normalize  it based on their criteria and it might be more than what you're seeing right now. Particularly on something like Repairs & Maintenance, you're probably showing nearly $0 because you just rehabbed it but they won't underwrite to zero R&M. Then I'm sure they will look at sales comps (if there are any) and figure out a market cap rate to use.

Just reach out to a lender and ask.