All Forum Posts by: Nick Fitzpatrick

I have purchased two duplexes on the same road that have been working out really well and would like to buy the other 4 on this road. I have looked up the proeprty owners and amd looking to mail them a typed letter. Any advice from you pro's out there on how the letter should read to get a call back.  I was thiking something like this.

Dear Mr/Mrs Proeprty Owner

I have recently purchased several homes on your street (I'm thinking I should list the properties so it seems more personal and not a mass mailer), and would like to buy your's. Give me a call and I would love to discuss your propertie and making an offer to purchase now or anyitme in the future you are considering selling.

Respectfully,

Nick

Thanks in advance, feel free to tear this apart.

I dont have much to ad with the creative options that hasn't already been covered above. But my family is also selling a home on the Mendocino Coast also I'm assuming this is the area you are talking about there's is about 30-40 minutes south of Ft. Brag in Manchester. And the real easte market there is much softer and slower to turn than any populated area i think they have had it on the MLS for 3 months or so.

Hey David,

Welcome to the site, I live in Sonoma County also, and the market here has recovered so well, it is tough to find anything that will even cover the PITI let alone cash flow. I have purchased a couple out of state in markets that have better cash flow, but it isnt without its trouble as well. I have also began like Orion looking at markets near by that have not yet recoved as much as the surrounding bay area, I have been looking into Modesto for homes that can cover the holding costs and possibly turn a small cash flow and hold for appreciation.

Bob, I understand what your getting at that 1-4 unit properties are valued based on comparable properties not on there income production.

So the best way of determining value of those assets would be by comps, and that is how an appraiser will determine a value. But I still have to agree with some others on here that it is a worth while metric to use in comparing how much your purchasing a property for versus how much it will rent and produce. Based on your bio it would seem you have bought and sold many properties over the years, did you never use cap rates, NIO, ROI or other metrics to evaluate?

And good article!

Not knowing anything about the neighborhood or expected appreciation, deferred maintenance of the property, age, type or current condition. I usually run my Repairs at 10% and factor in Capital expenses anywhere from 5-10% depending on age, and older property I will give 10%. I would also have to have a property manager at 10%. So it would be a 10.5% cap for myself. 

The number look pretty good to me, I have not found a SFR in the 80's that rents for that much. Looks like @Account Closed  doesn't like the numbers, I would be interested to know why?

@Joshua McGinnis This could very well still be a great deal or not. But I don't blame you for walking away, if you didn't feel comfortable with the process now during your due diligence period, with the disclosures or how this "turn key" provider was able to answer your concerns if likely would taint the rest of your long relationship with this company. 

That sounds like a major rehab, I would have to agree with the rest of the posters here. This will turn into a losing venture from minute one and continue on for the entirety of ownership. 

@Rodney Smith Welcome, I am also from Northern CA, Santa Rosa to be exact. I love going up to your area and spending some time at Lake Shasta! I have followed a similar path to yours starting here in CA and now moving into the midwest markets for long term buy-hold's. If you have any questions I would be more than happy to help.

welcome sterling! Striking resemblance to napolean hill

@Asha Holly , if I was paying such a poor price-rent ratio as this I would want to be in a market with great appreciation. And if your thinking home values wont see significant rise, I would look for better cash flow numbers.