All Forum Posts by: Rob Fegan

@David Lee when I started out a good book that covers the topic of commercial / multi family properties was Real Estate H2O by John Dessauer http://www.amazon.com/Real-Estate-H2O-John-Dessauer/dp/141969927X

It is worth a read (took me about 4 hours to read through the book and I got tons of great info. I would recommend reading it.

Rob

@Chris Adams do you use the LOC to fund the entire purchase and then get end loans (refinance) out? Do you use a local bank and can you share your strategy when you initially approached the bank for a LOC?

Thanks

Rob

Thanks for the post Mary, at this point I'm not really sure what the fines/liens or judgments are. The agent was not overly forthcoming with information.

I agree that a pleasant personality can go a long way. I just want to be sure at this point I'm turning over all the stones to see what land mines are waiting for me and who I should be extra nice to :-)!

Cheers,

Rob

Brian,

Welcome on board. I also recently joined bigger pockets and have found a TON of great information and a great community.

One of the cool tools that I have played with are the tools to analyze deals. I am also in the multi-family space and I get a kick out of analyzing lots of deals to help me get familiar with what makes a good deal based on my criteria (and of course there is nothing like getting offers out their)!!!

Best of luck

Rob

I am looking at a property for a fix and flip (or backup plan to rent). In talking with my realtor she mentioned that the property may have fines on it from the city (its in some bad shape).

Question: What city agency(s) should I be checking with to determine what fines are potentially out there on this property? As a follow up, what types of fines should I be looking for and could I assume that even city fines are up for negotiation as to the amount?

Any insight would be appreciated.

Thanks

Rob

Thanks for your posts guys. I have been fortunate for the first few Multi-Family properties where I have been able to see a 10% RoI in these small towns (but now I'm finding that 10% might not have been the norm). I am curious @PaulKhazansky what your rational is for staying out of these small markets?

Thanks again for your quick reply's and insight.

Rob

I would appreciate some feedback on this deal (located in the central valley of California). It is an 18-plex in a town 15K people with a very high rent to owner occupied ratio (renter being on the high side).

Property is on MLS listed at $749,000

Deal Summary:

18 units x $500 per unit = 9,000 gross monthly/108,000 yearly

Vacancy factor I am using is = 5%

Total Operating Income = 8,550 GM/ 102,600 yearly

Total Operating Expenses = 4,412 monthly/52,950 yearly

As a percentage of Income 51%

NOI = 4,137 monthly / 49,650 yearly

In my analysis to calculate what I should be paying I am taking the NOI / my expected CAP RATE, which in this case would be 49,650/.10 = $496,500

In this back of the envelop math I view my max offer price (on the assumption that I have good data on both the rents and expenses side) as $496,500 to achieve a 10% CapRate.

I would really appreciate feedback as to if I am on the right track or I have totally missed something here.

Thanks

Rob

From www.homepath.com: "HomePath offers owner occupants (homebuyers who will live in the home as their primary residence) an exclusive "first look" at newly listed foreclosed properties. During the First LookTM marketing period, you can make an offer and purchase a HomePath home without competition from investors. Look for the First Look logo to see which properties are still in the First Look marketing period."

I run into First Look properties often and must wait out the initial period prior to being able to offer as a non-owner occupied.

I am very traditional when it comes to looking for units, all my purchases (with one exception) have come from the MLS. The challenge is finding a realtor to work with that understands what you are looking for and is proactive in finding that diamond in the rough for me (you).

Although I always like to buy at a discount I am more concerned about how the property cash flows, not to say that i'm not looking for discounted properties but my number one goal is good long term cash flow.

There are a number of great episodes on the BP podcast that interview multi-family investors, I recommed checking out the BP podcast if you have not already done so.

Cheers,

Rob

I'm curious what other investors are doing when working with contractors; do you typically purchase your own materials and have your contractor(s) pull from your personal stock or do you have contractors acquire the materials as required. Also, if you have multiple properties do you standardize on the types of paint, appliances, etc. that you (or your contractor) purchase for your properties.

For some context I currently own properties (buy and hold) in blue caller and lower income area's that are renting in the $600 to $800 per month range.

Thanks for your insight!

Rob