All Forum Posts by: Matt J.

@Matt Jennissen

I had a HELOC from Wells Fargo. I transferred the property to a land trust with the intent to put the assignment later to an LLC to get the Garn st Germain protection on the due on sale clause.

Indeed WF didn’t call the loan due, but they froze my line of credit instead. I had to close it to be able to refi somewhere else. And WF took months to release the lien in violation of many regulations. I had to start suing them to make them move.

Sorry - I thought you meant raise funds from outside investors.  No.  But i DID get loan (35/65) at under 4% from regional bank.

That isn't really fair to say it's irrelevant. It's just another way (among the dozens of metrics) to analyze a deal or your actual property. I have a 24 unit property, and track CoC ann. trend and $ per door ann. trend monthly.

Cash on Cash formula is Cash flow/down-paymnt + fees.

Per door is Cash flow/number of doors.

In both cases the numerator is the same, changing the denominator just gives you a different way to look at it.  (and a simpler way to understand it for many.)

eg. my 24 unit makes CF of $60 annually. Thats ~200$ pd/pm. If that was a 30 unit, it would be ~165$ pd/pm. If I paid the same $ for both sample properties, you are right, the lower cash flow per door for the 20 unit makes it look less attractive - but the CoC and IRR would be exactly the same (based on the $60k). So I see that point. But f we play that out, and make it a 100 unit with that same $60k CF, the pd/pm is just $45 - even though your CoC and IRR is the same. I'd rather ONLY manage and R&M 24 tenants than 100 any day. So there is SOME value in using $ per door as ONE of many metrics to look at...

Return per door is irrelevant. It's all about return on investment over time and velocity of cashflow. Cash on cash and IRR are the metrics you need to focus on not doors.

Hey Eric,

Funny, I just read that article again. I'm always curious if there is any data that shows short term rentals create more issues for the city and neighbors. We have stayed in many STRs throughout the US and they always seem to be very well maintained. I'd think people would be more concerned by college rentals in Duluth. I do understand the need for affordable housing in Duluth, but I'm amazed at the resistance to STRs in Duluth since its economy is so driven by tourism. Good luck!!