All Forum Posts by: Mark Maire

Originally posted by @Mike M.:

Is the loan assumable?

What is the loan's monthly payment and how much time is left on it?

The seller when contacted Wells Fargo said as long as I qualify its assumable. I am pretty sure I will qualify near 800 credit score and full time job.

I might have to refinance because the PITI is at $900, but there is 20 years left on the loan. At $1100 I would be breaking even on CF assuming 8% vacancy($88) and 10% maintnance($110).

Its a 3 BR/1 BA SFR 1100 SQ FT. With detached garage and mother in law suite detached. The loan is at $110,000 with $20,000 in equity. He is renting it out to a friend for $900 but after researching 3 BR homes, the market rent is for $1050. I definitely think I can get $1100 or more since there is a detached mother in law suite.

The house has a new roof, updated plumbing, and new water heater and he is willing to throw in $3000 for new floors and interior paint; plus fix any minor things during home inspection.

I know this isn't the best deals, but it appeals to me because its nearly nothing out of pocket. What do you think?

I am also located in Hampton Roads area, we should talk the market. I am a young investor trying to get his feet wet also.
Send me a colleague request my work computer isn't allowing me to do so.

Originally posted by Steve Babiak:

Originally posted by Mark Maire:

... I am also sure I can get $1500+ but like I said the comps are only to $1450. ...

Don't be so confident about getting more rent than those comps; the tenants are aware of market rents.

I am aware. I am using the comps to identify if its a good deal. Only reason why I am thinking I can get possibly get more because this property is a 4BR and the only comps are 3BR. All similar quality in homes.

Originally posted by Mehran Kamari:

Joseph Weisenbloom I believe he meant 65% return with self management (10% is usually set aside for PM costs).

Mark Maire Either way, looks good @ 116k for a property in that price range. Meets the 50% rule AND may be more poised for appreciation than lower priced properties. I don't really know the market there though!

I notice you mention an HOA fee. Make sure to dig and do a little research on the HOA. How are their books? Review their minutes. Do they have any major plans in the near future that will end up with special assessments or raised HOA fees? A bad HOA can be a pain in the you know what.

Not sure what you mean by review their minutes. But I have been in this neighborhood for 2 years HOA has stayed the same and other neighbors has said it has gone up 10 dollars in 10 years. I also haven't heard the greatest reviews on them enforcing hoa rules but most of the homes around here and in great shape.

Originally posted by Mary B.:

Mark Maire

What's your exit strategies? 1st and back up?

Kudos,
mary

My only back up is to flip it. The ARV for a quick sale would be about $155,000.

Originally posted by David Beard:

First of all, discard the 2% rule when evaluating properties in this price and rent range. It's also very dependent on the local market, and for landlords that want to own properties where they live (generally a good idea), you have to work with what is available.

For this type of property, getting 1.25%/mth is probably acceptable (15% annual rent yield). At $1,450 rent, that means max purchase+rehab around $116k, so your thinking is sound. With a higher end property, with self management, you could probably net 65% of the gross rent to be applied toward P&I and your profit. So if you borrow 75% of that at 5%, and net 9.5% on the property, you will have an ROI of around 22%, including principal reduction. Plus tax benefits will give you some extra juice, up to the mid 20's on ROI. Nothing wrong with that, and you are in a nice neighborhood with better prospects for appreciation and better tenants to deal with.

Looks good to me.

I have decided to throw out the 2% rule in my area. There is a neighboring city where the 2% can apply but not interested in investing D neighborhoods. I am planning on managing it myself, the property is 3 blocks from my primary residence. I am also sure I can get $1500+ but like I said the comps are only to $1450. Also I very high volume of military in this area, about 5 bases within 1/2 hour.

Found a 4BR/2BA on MLS for $136,000.
Principal & Interest: $557
Taxes: $94
Homeowners Insurance: $55
MONTHLY HOA: 30

Only rents in the area are 3BR/2BA for 1350-1450
I will go with 1450 market rent.

Home needs carpet, paint, updated fixtures. Estimated $7500 in light rehab.

I am leaning towards putting in an offer at $115,000. Hopefully accepted but willing to meet in the middle.

I am located in vb. I am also in the navy I am yet to do my first deal but look forward to doing so.

If your wife doesn't like being so close to the tenant, I recommend don't being the landlord then. Live there being the role as a the property manager. Many owners live in duplexes, tri's, quads without their tenants suspecting the owner lives in the same complex. Create a LLC, tenants pay to LLC.