All Forum Posts by: Paul Doherty

I'm looking at a deal right now - 16 unit apartment complex. Asking price is 1,435,000 and the units have been recently refurbished. NOI is claimed at 100k making the cap rate 7%. Assuming someone put down 20% on something like this how much of that 100k of NOI is left after the mortgage payment? Would this thing even cash flow at all? I'm not seeing how, with a 1.1 million dollar mortgage payment (what terms are available - 30 years like a residential home)? Can someone explain how a place like would ever make you money if it's already improved and rents are already as good as they can get (and so is occupancy)?

I have a question about this.  Say you incorporate (in some form) to protect your personal assets from anything that might occur in your rentals.  How do you then acquire more rentals, since with single family homes it's always about your income and credit (unlike in multi-family situations like 5+ units where cash flow is what dictates financing)?

Thanks, Bill!

So if I'm reading this right I can find and acquire up to 3 properties (regardless of their total value) from the sale of the one, right? And I still have to close on all three within 180 days of selling the original?

I'm considering selling a property I own outright (worth 150k) and then, after realtor's fees, using a 1031 exchange to use the return from that sale to fund three or four new houses (30-35k down each). I understand the 1031 requires you to identify 3 like or better properties withing 45 days and buy one within 180. Does the same thing apply if I'm using the money to buy three or four? Do they all have to be purchased by the 180 day mark? How does this work?

Thanks for explaining it - it sounds WAY too good to be true and now I know it is.

Slow and steady wins the race...

http://www.lifestylesunlimited.com/how_15_rent_houses_can_retire_you_faster_than_a_million_dollar_401k/

Can someone explain what he means when, for instance, he goes from year 1 putting 5k of saved money down and buying a house with a "hard money loan" (I assume that means a normal mortgage loan?), and then says for year 2 save 5k and extract 5k from the first house? What does he mean by that? How is he getting money out of the first house?

I can't make it into a 4 bedroom. I am trying to rent it for $1450 or more (the smaller one rents all day for $1200 in the same area). If I sold it I'd be buying another small house (1300 sf or so) for rent. Downsides are realtor fees (of course), closing costs on the transaction, and I'd be moving from a very good interest rate to a slightly less-good interest rate (due to the new house being purchased as an investment house).

I did say rent easily. :-) I have a 1350 sf that rents itself - I can barely get it posted before I'm inundated with people asking to see it, etc. This one I can't even get people to look at and I'm asking only $250 more than the other house (even though it's almost 1000 sf bigger). I'm starting to wonder if it's worth the trouble/expense to maintain that much larger of a house (and a 2-story - 2 AC units) just to get $100-$200 more per month. They both have 3 bedrooms but the bigger house has much larger living room and bedrooms plus a gameroom, powder bath and formal dining room the other doesn't.

If you have 100k equity in a house but it's not going to be easy to rent (same number of bedrooms (3) as a smaller house but bigger sf by 1000) do you sell it and acquire a smaller house that's more "rentable" or simply lower the rent price and eat the greater maintnance costs (carpet, two AC units, etc)?