All Forum Posts by: Mitch Messer

Hey @Elijah Booker, welcome to BiggerPockets!

What concerns me most is that statement: "I have yet to have a conversation with a seller"

Here's the truth: It'll probably take talking to 50-100 prospective sellers before you even have a shot at getting a deal.

You don't get to change that.

You do get to decide how long you'll take to get those conversations completed.

Reach just 1-2 sellers per week and it'll take you a year or two before you get a deal.

Reach 10 sellers per weekday, and you'll likely get a deal within a month!

So get busy TODAY talking to sellers.

(HINT: It doesn't much matter where these sellers happen to be located. Find a cheap way to find sellers who need help, and then get busy serving them. And then, get better at it.)

And you were so close...

I recommend you take a close look at Tulsa! Strong rental demand, a growing economy, a supportive local government, and a business community that is seriously committed to making Tulsa the "Next Big Thing."

For starters, I would go back to all of the people complaining about the condition and test whether providing a repair allowance at closing would make a difference. Without tipping your hand, ask them how much of an allowance they'd need to make this a viable deal.

Maybe it's $50K, but perhaps it's far less!

Keep in mind that the money is only one factor; your TIME-cost is a far greater concern here. Doing a $50K renovation might take you months, which would mean even more holding expense.

And, the same problem you mention also applies in the DIY scenario: What if you take months to make $50K in renovations and then still don't get the offer you need?

Mentors get excited about helping people that they can connect with, whose dreams and goals are exciting and contagious!

You've been on BiggerPockets for over a year, yet you have no biographical info, no links to other social media accounts, and not even a photo. 

Honestly, would YOU mentor you?

If you already have the deal under contract, I'd recommend protecting yourself with an affidavit of agreement (AoA), rather than an NDA.

For one thing, the AoA gets recorded on public record and should therefore show up in a title search, preventing someone from swooping in and stealing your deal. The NDA is a private agreement and won't by itself stop a sale to another buyer.

I'm happy to share an example of our AoA. See my BP profile for the best way to reach me!

@Ngoc Vo Welcome to BiggerPockets!

The good news is that the financial metrics you've read about are universal and not at all country specific.

The bad news is that Germany may just not be a good cash-flow market, compared to the U.S.

But then, few markets are.

That's why you find so many Germans and Australians and Spaniards and others trying so hard to find great deals in the U.S.

And, even in the States, there are plenty of sub-markets where properties routinely fail the so-called "1% rule."

My advice is to keep searching, see the whole gameboard, and let the financials be your guide to great opportunities!

They are definitely out there!

Hey Gino, I reached out to you on LinkedIn. Can't DM here.

Hey @Jerry Zhang, congrats on finding an interesting deal!

I recommend you check your numbers: If current NOI is $37K and they're asking $500K cash, your cash-on-cash return at time of closing can't be more than 7.4%, and that's assuming an all-cash purchase, ZERO CapEx, ZERO renovations and ZERO closing costs. All very unlikely.

Also, I'd be highly concerned about that 18% vacancy rate you'd be buying into! That's NOT my definition of "turnkey!" Be sure understand the reason for it, so you're not digging yourself into a deep hole here.

Lastly, remember that cap rate is a measure of the local market. Without knowing the cap rates of other MFHs nearby, there's not much objective insight to be gained there.

Good luck!

That's a fair question, so I went back and checked. The PoA designates our company as AIF.

Now, it's possible that back during the original closing we had the borrower sign TWO PoAs: One designating our company, the other designating an individual representing the company.

Our original PoA was prepared in consultation with an attorney, but that was done well over a decade ago!

That said, the PoAs we have used, and this is across several dozen sub2 deals, has been with the company as AIF.

Never had a problem getting a lender check to clear in over 20 years.

@Jaime Powell Can you walk us through the pricing philosophy here?

For example, 107 Ellis Street will deliver about $20K in Gross Income once stabilized. After Operating Expenses are deducted, we're looking at about $13K in NOI.

Purchased for cash at the full asking price of $244,900, and assuming NO CapEx or renovations, that's about a 5.3% Cash-on-Cash return.

What am I missing?