All Forum Posts by: Raymond Ali

@CaseyHildreth Thank you Casey add me as a colleague so I can PM the inbox

Thanx Jasmine Wilborne

Im thinking about doing a direct mail campaign for absentee owners who own small apartment complexes (anywhere from 5-30 units). MY QUESTION IS: What should my direct mail letter actually say? And what success/failures have you encountered with doing direct mail? Thanks in advance for your advice. PS: I'm super motivated to get my first deal done so any response to help steer me in the right direction is much appreciated.

How do you determine if a rental property is worth purchasing or not?

I understand that the 50% rule is a guideline for analyzing rental properties but what if the properties expenses are taking 80%-90% of the annual income? is that normal?

for example if a property's annual income is $45,000

and the annual expenses are $39,600,

thats nearly 90% of the income going towards expenses.

would this be a potential investment?

i need hlep...thank you in advance

Hey Vyacheslav Avetisov ,

welcome!! I am also in the sacramento area interested in forclosures

-Raymond ali

Thank you Joel Owens it seemed like a cash flowing investment if purchased at the right price.. I'm just wondering what that price would be?

Thank you Ned Carey I appreciate your response.
my apologies for the confusion, i should have provided more info, i just wanted a quick analysis.

How are you defining "net Income:" is this NOI?
- im defining net income as "total income"

Do you know what Net Operating Income (NOI) is and how it is determined?
-yes i do know what NOI is and how its determined

this seems like a bad investment, am i right or wrong?
Who knows are rents, occupancy or income dramatically below where they should be? Are expenses out of control but have opportunities to reduce?

-the rents are $2200 for shared room, $3000 for a private room

How much should I offer on this property
You don't have enough information to make the determination.
-What additional information do i need in order to make a proper determination?

how can i make this property perform?
How could anyone possibly comment, given the information you have given us? Without knowing how it should be performing and exactly how it is performing now it is impossible to say.

Unless you can answer some of the questions I pose above you are not ready for this kind of investment. You need more education or you risk making some serious mistakes. Right now you do not even know what you don't know. My suggestion is you use this deal to practice on. Use it to learn what you can about evaluating properties. Good Luck - Ned

-Thanks again Ned, hopefully with your expertise i can learn something new today

I have evaluated this property using the typical NOI and CAP analysis formula Jose Enage and it just doesn't make sense at this price "$1,450,000"...but the purpose of this msg was to get your expert opinions because i'm still learning.

To me it failed the initial analysis as well but i was wonder at what price would this analysis work?

Thanks again!

Thank you, Tevis Verrett this facility is currently being managed by an experienced management company. i have also done research based on the 50% rule here on BP. but based on the 2012 financials it looks like 96% of this properties income went to expenses.

Thanks again

I am a newbie investor and I need help, I don't want my 1st deal to be a nightmare. I'm looking at purchasing a 12 unit multi-family senior living facility. This business is already fully staffed and up and running But the seller is just too old to keep up with the property. She just wants to get this off her books and she is motivated. I would like to buy and hold and possibly do a 1031 exchange for another income producing property. There are currently no other offers, But here are the specifics:

Sale price - $1,4500,000

2012 net income - $392,280

2012 total expenses - $378,905

Just based on these numbers, it looks like about 96% of the income is going towards expenses. this seems like a bad investment, am i right or wrong?

How much should I offer on this property?

how can i make this property perform? or should i just continue on my search and purchase a property that is already performing with positive cash flow?