All Forum Posts by: Nandy B.

What is the cheapest house you ve ever purchased?

Why did you buy it?

what did you do with it?

Would you do it again?

I hear about so many big money deals but low cost acquisition stories can be inspiring and motivational as well.

@Cassi Justiz

Thanks for your insight.

I was thinking the same thing.

I might have to reach out to owners and start making offers. I did see a few properties in that price range in the MLS but I d rather try to reach the owner for seller financing options.

I ve never consider direct mail. I guest I ll need to find a lost of some sort to find absentee owners?

I’m looking to expand my portfolio in Stillwater Ok and surround cities. I grew up in the area and my parents still lives there. While it’s rural, I ve found that it has decent returns in terms of cash flow compared to the DFW area where I currently own 2 properties that are barely cash flowing (newbie mistake).

I’m looking to acquire properties thru owner financing around the price ranges of 30-60K that need modest repairs (cosmetic). I’m looking for smaller properties around 600-1000sqf, preferably 2bed/1bath which is common for the area.

I can put down 20-30% down payment. I’m looking to buy 2 properties by November 2019.

Is there anyone in the area (Lawyer, Realtor, Wholesaler)  who can help me with this?

✅I would like to understand the market better

✅ I would also like to understand owner financing laws

✅ Any leads will be welcomed

I’m looking to expand my portfolio in Stillwater Ok and surround cities. I grew up in the area and my parents still lives there. While it’s rural, I ve found that it has decent returns in terms of cash flow compared to the DFW area where I currently own 2 properties that are barely cash flowing (newbie mistake).

I’m looking to acquire properties thru owner financing around the price ranges of 30-60K that need modest repairs (cosmetic). I’m looking for smaller properties around 600-1000sqf, preferably 2bed/1bath which is common for the area.

I can put down 20-30% down payment. I’m looking to buy 2 properties by November 2019.

Is there anyone in the area (Lawyer, Realtor, Wholesaler)  who can help me with this?

✅I would like to understand the market better

✅ I would also like to understand owner financing laws

✅ Any leads will be welcomed

@Jon S.

Much needed discussion... Even In 2019

After about 4 years of attending REIA meetings, I m sad to say this dilema is still so real.

As a single woman I m often the unicorn 😂 surrounded by either couples or single males. Nothing wrong with it, I ve always wondered why.

I m embracing my journey and wish I could grow faster but I need to take it one step at a time.

@Tom T.

Thanks

@Dennis M.

Yes they usually do, when it's an owner financing deal. have you ever done one?

@Jason Allen

Will do.

Thank you

These are all great questions 

- I do not know that the seller will consider seller financing? if was hoping I make an offer and start practicing the process of making offers anyways until I find one who says yes. I honestly do not have any other options. IF someone can think of one, i'm open. if not I'll move on to other properties and make other offers. 

- We will be self-managing the properties. If we hire a property manager it will be 10% or less. 

- Yes, all units will rent very very well in the area that it's in. the other option will be in slow season to offer corporate housing or month to month university housing to graduate students at the university less than 4 miles away. 

- As far as Rehab - most of them are currently cosmetics. My family will handle the rehabs ourselves. We did for both of our current single-family units. We will rehab in increments as tenants lease end: will rehab, furnish and rent. I did not know how to include it in the calculations. 

- I see this as me taking action towards my goals of acquiring an owner financed Multi Family or small apartment by the end of the year. Best case he says yes, worse case I have gotten over the fear and apprehension of making owner financing offers. 

A small apartment for sale in the most desirable area of town. Sales Price 750000.00. New apartments are being built in the area going for $250,000+ for 1b townhouses (bigger). The numbers do not make sense at all as a LTR (long term rental) but as a STR (short term rental) they do not look bad at all. I currently own a SF-STR in the area that makes 3X what I would get for a LTR monthly rent. Regulations were passed recently banning STR in the city except in this zip code. The area is commercially zoned as well. The seller is aware of the above so he is overpricing the apartment. Hence, It has been sitting on the market for over 400days.

Owner Financing OFFER!

I would like to make an owner financing or rent to own offer based on the numbers I have put together below.

HOW YOU CAN HELP

• Analyze the deal itself
• IF it’s reasonable, what offer should i make? How do i write it? -- open to a consultation call.

ABOUT ME

1. High debt to income ratio because of grad school
2. Have a great full-time job i love - scientist
3. Own 2 properties - the one i live in, and another i STR.
4. I'm new to real estate investing and would like to specialize in creative financing and STR or vacation rentals.
5. My whole family will be supporting this acquisition and the running of the STR business.

*******THE NUMBER*********

based on this spreadsheet - https://www.vertex42.com/ExcelTemplates/rental-cash-flow-analysis.html

NUMBERS THEY ARE Claiming

1. Gross Annual Income: $65,904
2. Gross Annual Expenses: $13,180
3. Insurance Expense: $5,720
4. Capitalization Rate: 6.27

LONG TERM RENTAL

MONTHLY OPERATING INCOME

1. Number of Units 8
2. Average Monthly Rent per Unit - LTR 680.00
3. Gross Monthly Operating Income 5,440.00

MONTHLY OPERATING EXPENSES

1. Property Management Fees 600.00
2. Repairs and Maintenance 33.33
3. Real Estate Taxes 2018 records 1,095.00
4. Rental Property Insurance 480.00
5. Homeowners/Property Association Fees 0
6. Replacement Reserve?- Utilities? -Pest Control? -Accounting and Legal? -Advertising?
7. Monthly Operating Expenses 2,208.33

Net Operating Income (NOI)

1. Total Gross Annual Operating Income 65,280.00
2. Total Gross Annual Operating Expense 26,500.00
3. Annual Net Operating Income 38,780.00

CAP RATE and VALUATION

1. Desired Capitalization Rate 6.27%
2. Property Valuation (Offer Price) 618,500.80
3. Actual Purchase Price 749,900.00
4. Actual Capitalization Rate 5.17%

SHORT TERM RENTAL

MONTHLY OPERATING INCOME STR

1. Number of Units 8
2. Average Monthly Rent per Unit - STR 2,000.00 very modest estimate
3. Gross Monthly Operating Income 16,000.00

MONTHLY OPERATING EXPENSE

1. Property Management Fees 600.00
2. Repairs and Maintenance 1,000.00
3. Real Estate Taxes 2018 records 1,095.00
4. Rental Property Insurance 480.00
5. Homeowners/Property Association Fees
6. Replacement Reserve 51.00
7. Utilities - Electrical, gas, trash, water sewage, internet, cable 4,080.00
8. Pest Control? -Accounting and Legal? -Advertising?
9. Monthly Operating Expenses 7,306.00

NOT INCLUDED - furnishing expense which would be about 3-5000 per unit.

They will be scaled up slowly as each tenant moves out.

Net Operating Income (NOI)

1. Total Gross Annual Operating Income 192,000.00
2. Total Gross Annual Operating Expense 87,672.00
3. Annual Net Operating Income 104,328.00

CAP RATE and VALUATION

1. Desired Capitalization Rate 6.27%
2. Property Valuation (Offer Price) 1,663,923.44
3. Actual Purchase Price 749,900.00
4. Actual Capitalization Rate 13.91%

I would like to request a seller financing deal - the max I’m open to paying for interest is 10% but I’m hoping to get around 6%

LOAN INFORMATION

1. Down Payment 79,000.00
2. Loan Amount 670,900.00
3. Acquisition Costs and Loan Fees 8,000.00
4. Length of Mortgage (years) 30
5. Annual Interest Rate 10.000%
6. Initial Investment 80,000.00
7. Monthly Mortgage Payment (PI) 5,887.63
8. Annual Interest 66,832.37
9. Annual Principal 3,724.39
10. Total Annual Debt Service 70,651.53

Cash Flow and ROI

1. Total Monthly Cash Flow (before taxes) 2,806.37
2. Total Annual Cash Flow (before taxes) 33,676.47
3. Cash on Cash Return (ROI) 42.10%

Thank you