All Forum Posts by: Masroor Ahmed

That'd be great.  I'd love to attend. Just spent 2 full days looking at properties in C-U.  Lots going on!

Oops! I misread your post and typo'd.  Nevermind, $2500/MONTH.  :)

Not only is your goal possible, but your $150-$200k should be generating more than that right now. Just go put $50K in a high yield fund like "HYG" and you're done. My point is you can generate that income on a reasonable fraction of your cash with only moderate risk, without real estate.

Just FYI, that's not a "too good to be true" deal in my market (central IL). Most deals I'm looking at are < $30k per unit. That said, without knowing anything, I'd say, be sure you understand true vacancy rate, local crime trends, and deferred maintenance.

No worries. Didn't end up going because of a conflict. But I'll be in U-C area Thursday/Friday of this week.

Hey folks.  Curious if you've heard of this conference I mentioned above? (cc: @Jeremy Lamb, @Scott Dixon, @Rob Anderson, @Anthony Hornbeck)  My objective is trying to get a handle on south east Urbana.  I own in small MF there and I'm trying to understand the general downturn in that area and what can be done about it.   Looking to invest more in C-U and I'd love to grow in immediate proximity to my current building, but I have several concerns and it might help to meet some like-minded people at this conference (potentially).

Hi all:  Any Champaign-Urbana (or even central IL) investors considering attending in the C-U RNNC conference coming up at the end of September? It might be a good way to get a broad sense of what's going on in the C-U area so curious if anyone has attended this in the past or plans to attend this one? (http://www.2016rnnc.com/).

About 9 months ago, I bought my first REI, a 7-unit for $250K. It's maybe a B- neighborhood and the major lesson has been that vacancies are tough to keep down. I priced the deal assuming 15% vacancy and so far it's been ~25% effective vacancy. I've already put in 2 evictions and maybe another one coming. However, my property management firm is doing decent and getting solid/new tenants. That all being said…

Now my neighboring 2 buildings are off-MLS but up for sale. Two buildings, 19-units in total. Obviously, I'm excited to have a look. Here are the high level numbers – mostly based on my own estimates being a recent owner next door:

$119K Scheduled Rent

$93K Actual Rental income

$9K Mgmt Fees (9%)

$20K RE taxes

$15K ($50/unit/mo + $200/mo. exterior lawn/snow)

$9K Insurance (This is an est based on my 7-unit costing $3.5K)

$15K Utilities

$5K CapEx/reserves

$20K NOI (of course they provided a much higher NOI estimate)

Feel free to question my assumptions, but the real difficulty I'm having is assessing what vacancy rate I should assume in valuing the building. To put another way, if I price it on current NOI @ 8% cap (which is about right for this deal), that implies $250K or $13K/unit. However, looking at MF comps (which probably have much better vacancy rate), they're more around $35K/unit. And besides, I paid $35K/unit recently and you could argue I overpaid, but not that much. This vacancy issue means that at $450K I could be getting a steal, or could be inheriting zero cash flow and a subpar return. What would you offer? (FYI they're asking $590K FWIW).

What a great story...Congrats!  Your story is very inspiring and its been great to follow a fellow Chicagoan's success! I got deal #1 done 3 months ago....need to catch up :)

Awesome @Brie Schmidt ! I closed deal #1 last week and now have 7 units.  I'd be happy if I could move at 1/2 your pace! Great see see another successful Chicagoan.

Masroor