All Forum Posts by: Randall Williams

and watch EPA issues, we've got one here in town like that. ARV +/- $90K, they're asking $17. sewer backup and then diesel oil spill in the basement, now the drywalls and floors have been removed.

Saw another little gem, $19K asking on a gorgeous lot - roof had fallen in with all possessions inside. I was inside for 5 minutes and could still feel the mold in my lungs the next day.

And - @Chris Eaker, Zillow publishes "pre-forclosures" for homes in default. Does one track those lenders down, or would you direct-mail the residents who might want to short-sell?

In about 12 hours, I'm meeting with a couple who own a condo association to discuss me buying it. It's 8 duplexes in a woodsy little micro-subdivision in my town. 

I own my primary residence, and recently bought a duplex, so I'm pretty green, though I've been doing scads of BP book and forum homework and deal-calculating.

I'm interested in advice from people who own groups of condos, specifically about financing and stuff that would be easily missed by newbies who otherwise have a decent sense of how to look at a deal. 

Here's where it's at: They're asking $1.35M for 16 units, land, and maintenance shed. The properties are all two-story duplexes, and *I guess* rent for an average of $900. Gross rents would be $14,400, just over 1%. I get real numbers tomorrow. If (commercial, 5%) debt service is $6K, there's almost no way to make that sale price work.

I *might* be able to scrape up cash if I get a HELOC on the rental property that I own free and clear, and again on my residence, but I'm really loathe to pull out equity for this size of risk with little experience.

They're willing to consider financing, which would be amazing - if so, I just need to get the sale price right first. Duplexes like these are going for an average of $90K here - which makes these properties way overvalued at $168K per. It really ought to be less than $800K for the whole shebang.

Obviously, there are a bunch more numbers to plug in - CapEx, insurance, vacancy rate, landscaping, snow removal, admin and management, etc. Is there anything *yuge* that I'm missing? Maybe there are HOA fees that I'd pick up for utilities and maintenance?

Thanks gang, 

Randall

Da'Vione Johnson , welcome. Find BP member @Thomas Neely in STL, he's doing awesomely inspiring stuff with --very-- cheap homes.

Erick, my first duplex brings in the same amount of gross rent you mentioned, and I paid one third of what you're looking at. I'd run the numbers through the BP calculator.

Welcome. Your post is massively inspiring. I'm 41 now, own my home (I rent two bedrooms out) and recently refinanced 60% of it to buy a duplex in my town. I work a day job remotely that has me traveling to 20 countries yearly, and realize about $1000 monthly from the rentals. I bought my 36ft sailboat for a dollar on the condition that the former owners could sail her a few weeks per year. I spent last winter cruising in the Keys, Cuba and the Bahamas, and will launch again soon and head South to the Caribbean again in the Fall. The sailing away part is the easiest piece of this puzzle - just keep focused and you can make it happen. And check the find-a-crew website regularly. :)

Check out what BP member @Thomas Neely is up to - buying $5K homes, investing $10K, then getting 400/month for them as rentals in STL. It makes him money and creates affordable housing.

And, it's only a money maker if you have no debt service. But those numbers are too tight - I'd make an offer then move on.

Impressive and inspiring, thanks for sharing. There are two $20K homes in my otherwise primarily 6-figure neighborhood that I've been thinking about, your post is encouraging me to think a bit harder about them. I've spent lots of time in STL. I have a good friend who's a broker there and a gem of a human, I'd love to introduce you. PM me if you'd like.

Those numbers look good - what did the inspector say about big-ticket maintenance items coming up?