All Forum Posts by: Sam L.

I'm looking at buying a 4-plex with an FHA loan in Tucson, AZ. I found a great property in a nice area that cashflows; however, the listing is actually 2 parcels with a duplex on each. I'd like to combine the two parcels, but don't know where to begin or who to talk to. I understand the process can be lengthy (zoning approval, surveying, new parcel # approval). Does anyone know of resources or have experience with this?

My apologies if this is the incorrect subforum for this.

I'm looking at buying a 4-plex with an FHA loan in Tucson, AZ. I found a great property in a nice area that cashflows; however, the listing is actually 2 parcels with a duplex on each. I'd like to combine the two parcels, but don't know where to begin or who to talk to. I understand the process can be lengthy (zoning approval, surveying, new parcel # approval). Does anyone know of resources or have experience with this?

My apologies if this is the incorrect subforum for this.

Ask away.

I would suggest looking at your target market and running the rough numbers (50% rule, etc) on a number of properties. You'll get an idea of the cap rates in your area and what is a realistic goal. Remember, better deals take patience, marketing and/or fast action to find and get under contract. How quickly and how much effort do you want to expend to get a deal that meets your 20% COC goal?

Also, I second the idea that you must see what type of properties fall within your search criteria. Aiming for a 20% COC and using the 50% rule will typically turn up properties where the maintenance will be higher. You might need to use 60% for older, more poorly maintained properties.

Finally, how do you plan on financing the property? The conditions of the loan will greatly affect your COC and cashflow which are INVERSELY proportional as you adjust the down payment.

Things to consider. I wish you the best of luck. I'm in a similar boat now.

What are typical ways of partnering with investors for buy-and-hold deals? What exit strategies do you employ if an investor wants out?

I am a buy-and-hold investor who is about to get my first 4-plex via an FHA loan. What financing options do I have for deals that come up while I still have the FHA in place? Conventional requires 25% down for 3-4 plexes, and I'd like to know if there are any lower down payment options I can employee while I build up my equity.

@Anthony G.

What type of financing would you use on deals that come up while you are still using the FHA loan? 20k limits you to 100k properties with conventional loans.

You are overlooking that it takes time and effort on your part to:

A. Find a deal

B. Run the numbers

C. Buy the property

D. Be a landlord

E. Risk not getting reliable returns (ie. longer than expected vacancy costs you money)

Many investors are not willing to take all of those actionable steps to receive higher returns especially when buying stocks, bonds or othe investment vehicles are so easy today. Furthermore, if you have a large sum of money (say $500,000) that you are saving for retirement, it would take a considerable amount of work to manage the number of small multi family units that you would need to get the increased returns on this kind of money. Full-time professionals, retirees and many people do not have time or want to put that much effort into gaining a better return on their money. This is why someone like yourself who IS willing to take these steps can benefit from an increased ROI.

Thank you Brianna and Jesse. I'll definitely ask around at REIA groups for a broker referral.

I'm looking to acquire my first rental property and am wondering about the general advantages and disadvantages of different lending institutions. Credit union vs big bank vs smaller bank, etc?