All Forum Posts by: Mike S.

Hi Landlords, Property Owners & Smart People,

Currently, my properties are turning great returns and are providing me with wealth (not substantial but pretty kick ***).  I am looking at a deal for a long term hold and in it to win it, but strangely confused - looking for your assistance.  

Here is the deal - not sure if it is complex but I will do my best to explain:

Property A 

Purchased at 305k, renovated, rented and retaining: Single family renting at $5000 a month - great cash flow - equity in home is substantial - value of home is over 700k; currently have 1 mortgage on home and owe $220k; have equity line of credit of $150k and have not touched it; Net Annual Return is 44% roughly (probably won't come across anything like this again) 

Property B

Purchased at 450k, renovated rented and retaining: single family renting at $4000 a month - decent cash flow - equity in home has increased due to reno - value now worth near $550k conservatively and have 1 mortgage on home; not really interested in doing to much more with this property at the moment; Net Annual Return is around 10% (put a substantial down payment down to increase cash flow)

Property C - Looking at dealing - Buy? or not? 

Asking 650k, needs upgrading - kitchen, flooring e.g..; renting at $4425; knowing what the market is at 30 year 5.6% for investment properties or even a 15/1 arm 5.5%; do the numbers work out? depends on how you buy? or again look at long term hold? IF (and thats a big if) I can get in at near 600k; how can you finance this to make it work? does it make sense to use the Line Of Credit from Property A for down payment?  

How I see the numbers - and looking for feedback here

$2500 for mortgage 

$700 for interest line of credit (is based off prime and adjustable monthly)

900 for taxes (name of the game for playing in this city)

$150 for ins

To close to deal, to risky? All thoughts welcomed. 

Thanks! 

@Julie Marquez Whooops... i didn't notice a page 2 until just now. Sorry about that.  We have a granite guy that does good work and is reliable. Puts in undermount sinks that are affordable. Faucet was purchased via amazon for around $100. The Fridge:  It was pricey (~$1000) - but best deal I could find for a french door.  I think the sale knocked off $250.  So we were happy.  I think we paid around $399 for the SS dishwasher.

@Brent Coombs and @Michael Maloney Jr. ( I don't think it hyperlinked on my last post.. thanks guys!)

@Ned Carey and @David Sohn (I don't think it hyperlinked last time I posted...) 

(I like this one better) 

@Julie Marquez What was your final decision? I happened to recently upgrade my rental to SS.  We originally had all black.  The microwave went, changed it out with SS one 2-3 years ago.  Dishwasher was failing us... changed it out to a SS with the addition of granite countertop.  Lowes had a super - sale on a SS fridges and upgraded this.. it took a month for delivery. Here are the images from before/after... 

Thanks @ned carey and @David Sohn.... After reworking it and reworking I would have to second your assessments. However, one that I turn away from not easily though... Reason be, looking year out gross rents yes that would be max ($4k) - in 2-5 years I would be hard pressed to have increased rents go to $750-800 with the system in place and HELOC loan would be paid down (- $450). Monthly payment would be $3150. Netting monthly around $1000. @David Sohn my business is built around renting to college kids. The risk is that of location. Is the college/university ever going to go away? 

Questions to you both - What is your typical average ROI? and are you both looking at cash flow or building wealth?

Thanks @brent Coombs and @ Michael Maloney Jr.... After reworking it and reworking I would have to second your assessments. However, one that I turn away from not easily though... Reason be, looking year out gross rents yes that would be max ($4k) - in 2-5 years I would be hard pressed to have increased rents go to $750-800 with the system in place and HELOC loan would be paid down (- $450). Monthly payment would be be $3150. Netting monthly around $1000. @ Michael Maloney Jr. my business is built around renting to college kids. The risk is that of location. Is the college/university ever going to go away? What is your average ROI? and are you both looking at cash flow or building wealth?

Looking to buy third income property and need help analyzing it.

Property Details-Asking price $565000. (Lets say the bank doesn't budge and I buy it for this amount and seller pays closing costs).

Multi-family 2 unit 1 bed/1 bath and 4 bed/1 bath. Great location! Close to large campus/student property with great downtown.

Currently both units are rented out at $1300 for 1/1 and $2600 for 4/1.

Have been pre-approved for $575k. Using equity from other investment property for down payment and plan to pay off (down payment) within 1-2 yr.

Used a mortgage Calculator=Monthly Payment= $3600 (for Mortgage, Loc, Taxes, Ins)

Doesn't include vacancy, cap ex etc. - Utilities paid for by tenants

Property is not updated and is rented until Aug. 2017.

Property is in a great college town with multipliers around 10-12x. Average rents per bedroom $650-700; $800 when updated.

Need help analyzing the numbers to see if it would work for me in the long run. Long term buy & hold property.

Thank you in advance!

Looking to buy third income property and need help analyzing it.

Property Details-Asking price $565000. (Lets say the bank doesn't budge and I buy it for this amount and seller pays closing costs).

Multi-family 2 unit 1 bed/1 bath and 4 bed/1 bath. Great location! Close to large campus/student property with great downtown.  

Currently both units are rented out at $1300 for 1/1 and $2600 for 4/1. 

Have been pre-approved for $575k.  Using equity from other investment property for down payment and plan to pay off (down payment) within 1-2 yr.  

Used a mortgage Calculator=Monthly Payment= $3600 (for Mortgage, Loc, Taxes, Ins)

Doesn't include vacancy, cap ex etc. - Utilities paid for by tenants

Property is not updated and is rented until Aug. 2017. 

Property is in a great college town with multipliers around 10-12x. Average rents per bedroom $650-700; $800 when updated. 

Need help analyzing the numbers to see if it would work for me in the long run.  Long term buy & hold property.  

Thank you in advance!