All Forum Posts by: Randall Marshall

If I travel 400 miles total, log the miles in my logbook, and have an open house for a rental property, stay 1 night in a hotel, and drive back home, are mileage, lodging, and meals deductible? I've been reading that only 50% of meals are deductible but can I instead simply take the first/last day per diem amounts listed on GSA? Do I still need to keep receipts for meals and lodging?

Thank you everyone for the very helpful replies. I am very eager to learn and begin. I agree that the numbers for this property are not very good. I'm currently heavily invested in another business that I've slowed expansion to diversify cash towards another industry, in this case, real estate.

@Race Ostler

I had not heard about Mountain America's mortgages. Those down payments are impressively low. I will make sure to check with them. Financing a 4-plex or less with a residential loan would be a great way to start out.

@Jaiden Olsen

That is a really solid spreadsheet, far more sophisticated than mine. Thank you, it is more helpful than I can say. I estimated the closing costs at 2% of the loan without really knowing what they would be. Some reason I lumped repairs with capex in my head. Thank you for correcting me.

@Don Spafford

The Salt Lake market is expensive and I am envious of markets with better cash flows. Utah has an easy website that lists most MLS listings. You're right that I stuck with the area to be closer but perhaps local options are not the right route to go. I need to learn the same for other markets. Discovering opportunities is a difficult skill to master and I look forward to the day I find myself with a few available.

I spent 6 years in Eastern Idaho and have family in the area. I am new, want to learn, and want to build a portfolio. I am not necessarily looking to only loan out money but that is something I can bring to the table if it means learning and working together on a deal. Let me know if you want to talk more or perhaps keep me in mind.

I was under the impression I must use a commercial loan. Further reading makes it appear a four plex also qualifies for a traditional residential mortgage. Around here a 30 year fixed in 3.625% which would up the cash flow to $700. (Still 25% down) Is that right?

 You are right. The $6100 should have been the yearly cap ex/vacancy. The monthly amount in my formula is set at $508 which is around 8.33%. So I'm a little low. Thank you.

I'm located in the Salt Lake Utah area. I'm trying to build a spreadsheet for evaluating properties. Here is an example of a property for a newer 4 plex currently available. I came out with a negative cash flow of $203. Am I missing any other obvious expenses? Are any of these expenses over or under expectations? This building was built in 2015 and is outside of a growing tech area.

• Purchase price: $940,000
• Loan amount: $705,000 (25% down)
• Closing costs: $19,000
• Loan terms: 5% interest, 25 amort, 10 year call, 5 year rate adjustment (Estimating here based on bank websites)
• Monthly rent: $6100
• Monthly HOA: $648
• Monthly property management: $427
• Monthly cap ex/vacancy savings: $6100
• Monthly mortgage payment: $4121
• Monthly property tax: $181
• Monthly insurance: $180
• Cash flow: -$203

With no property management the cash flow becomes $224 and no cap ex/vacancy it becomes $733. Thank you.