All Forum Posts by: Munim Jalil

Hi BP,

We currently have 3-multi family investment properties in NYC. Each property currently has their own homeowner’s policy + a umbrella policy with a $5M liability coverage. Based on my research, when your property is fully rented (i.e., you don't live there anymore--BRRRR) it makes sense to transition over to a landlord policy. The landlord policy will protect the property from damages from tenants which may not be covered by the original homeowner's policy (this is inclusive of tenants having a renter's policy). We are also working on transitioning each property to their own LLC and that LLC will roll-up into a holdings company.

Questions - Would folks be able to shed some light into transitioning over from a homeowner to landlord policy, is it worth it - should we, do it? Do folks know of any insurance companies that offer competitive landlord polices in NYC? What are the folk’s current set-up in protecting their properties?

Best,

MJ

Hi All,

Thank you all for the great feedback. 

I wanted to provided some additional context and update on the deal.

Context - The targeted property is actually attached on both sides to two properties we currently own, we will have economy of scale post deal closing. This property will enable us to own the full lot and opens us for further expansion and buildout (strategic purchase for us). We are extremely versed and conservative on the value of the property, we know the seller and acquiring the property on a deal. Since we own some of the surrounding rentals we already have actual comparables to ground our model. The property also comes fully occupied with a high rent roll. Based on the cashflows and NYC open market - this property would be listed for $1.2M on the open market via realtor. Unfortunately, NYC hasn't seen the same softness in purchase prices relatively to other markets, $1M was the best offer.

Deal Update - We should be in contract by the end of the week unless the seller has additional redlines to the contract. 

Will keep you guys posted as we move along the deal cycle. 

Best,

MJ

Hi BP,

We currently have 3-multi family investment properties in NYC. Each properties currently has their own homeowners policy + a umbrella policy with a $5M liability coverage. Based on my research, when your property is fully rented (i.e., you don't live there anymore--BRRRR) it makes sense to transition over to a landlord policy. The landlord policy will protect the property from damages from tenants which may not be covered by the original homeowners policy (this is inclusive of tenants having a renters policy).

Questions - Would folks be able to shed some light into transitioning over from a homeowners to landlord policy, is it worth it - should we do it? Do folks know of any insurance companies that offer competitive landlord polices in NYC? What are the folks current set-up in protecting their properties?

Best,

MJ

Hi All,

I like to the BP thoughts on this.

Context - We are in the midst of purchasing a 3-family property in NYC to be used as an investment rental.

We agreed upon a purchase and had our contract drafted and sent to the sellers lawyers.

The seller came back very upset, that he wants us to waive the mortgage appraisal clause in our contract? This clause protects in the case of us needing to walk away from the deal if the appraisal comes in too low. NYC property’s fluctuate quite a bit from neighborhood to neighborhood. The current assessed tax value is $780k and the agreed upon purchase price is $995k.

We also had additional clauses for his tenants since he had a section 8, requesting him to escrow some money until the rent starts to come to us - since the transition takes forever.

The sellers seems like he just wants to completely unload the property without any stipulation.

I wanted to hear folks thoughts on the matter?

 I have, but haven't figured out exactly how to start - but love to learn more about how to get involved in Midwest investing!

@Wesley Sherow First, thank you for advice! I would definitely love to learn more about investment opportunities further upstate in NY. Unfortunately, we are not looking to leverage our portfolio at the moment since our cash at at hand will enable us to purchase a property every year. Don't get me wrong if there is a property that we believe has some great value, returns and the numbers make sense we will leverage our book - these deals are much more difficult to come by. I also agree about your comments around NYC investing, NYC is in a market in itself from the prices, tenants to city/housing regulations. 

Let provide some additional color on our portfolio - we have $1.3M in owner equity + $1.5M  appreciated equity value for roughly about $2.8M. We purchased all properties in distressed conditions, directly from the owners and off-market. These are multi-family buildings (1-4 units) where we expect the rent roll to increase over the next 5-10yrs + additional appreciation of the underlying assets (we have not priced this into our valuation, we are relatively conservative - $4M is what we expect if we unloaded our portfolio today). We did not raise capital nor did we did we syndicate our deals. We are not looking to sell our portfolio but rather add to it or leverage the strength of our book for future acquisition.

Hi All,

Looking for some advice from the BP community!

Background on our journey -  It's been 5yrs since we started our real estate journey in NYC. We purchased our first multi property at the end of Dec-17 and added a new property every year and half. We had some major set backs along the journey - one resulting in owning a vacant building for one year. We have bounced back since. 

Portfolio key stats - We currently run a 9% Cap Rate in NYC with a FCF of $177K on an Unlevered basis-forecast*. We will look to maximize our portfolio (increase rent, property development, etc.) over the next year and half to a reach a 13% Cap Rate with a FCF of $264K+. We currently own 10 rental units split across 4-properties. Our portfolio value will come in shy of $4M (based on our valuation and market comparables) with a debt to equity ratio of 30%:70%. 

As we enter a high interest environment with an impending recession, how do we maximize our FCF and equity value on our portfolio? We are interested in purchasing larger multi-family buildings (6+ units) / mixed-use (commercial + residential building) / Airbnb type of acquisition. We are also exploring investing in other states where our dollar will go much further. 

Any advice/tips are greatly appreciated!

Hi All,

Hope everyone is healthy and well.

I'm looking to personally rent out my 3-unit house in NYC. I know I can hire an agent and have them take care of all the paperwork, but I want to really understand the process. I was originally think about posting my listing on Craigslist and taking it from there. 

I'm curious to understand from the community if anyone listed their rental properties, if so what did the process entail? Is there a way where you can list your unit and it'll appear on major listing sites (i.e. Zillow, Street Easy, Trulia, Redfin, etc.)?

Best,

MJ