All Forum Posts by: Christopher B.

Always want to verify All numbers provided by sellers.54%CoC and a 14 cap rate sounds too good to be true, don't you think? Thing with students is most move home for the summer so you can't expect or rely on 12 month leases.

I agree with Greg. After you do a deal or two people will begin looking at you differently, even treating you differently. I'd focus on looking at properties and honing your evaluation skills. Successful deals will lead to more successful deals and the team will fall into place. I felt like a lone wolf a lot in the beginning. 

You're right and you're friend is wrong.

@Andre C. thank you for the input.

I'm going to have my agent see if they can find any comps for tri's in the area, I purchased a duplex 2 blocks over on a less desirable street a few years ago. It was a foreclosure I remodeled, all-in Cap Rate of 9 while it appraised at $142k which is right under a 7 cap, so an appraisal of $190k isn't unreasonable.

I'd appreciate some opinions on this. I have a sfh rancher that has a detached garage with apartment above it that came with a package of 4 houses. I intended on converting the house to a duplex but am reconsidering. Below are what I consider conservative rent #'s, I feel I may be able to get an extra $100/month income via rent and storage units and I also feel the home will appraise enough for me to pull all my cash out but include a worst case scenario of putting 25% of my total investment down. The rehab and operating expenses should be close.

Basically, the #'s reflect me converting the sfh to a duplex (city has approved my plans), splitting the garage into 2 10x20 storage bays, and remodeling the garage apartment. The house is in rough shape and needs everything, roof, plumbing, electrical, 3 HVAC's, etc.

Purchase: $40,000  1737s.f. sfh ranch with 580 s.f. detached garage apt

Remodel: $103,000

Rent: $2100/month  $700 2/2 apt, $700 2/1.5 apt, $600 2/1 $100/month for 2 storage bays

Op. Exp.: $982  includes: 10% mgmt., 5% maintenance, 5% capex (replacing everything), 8.33% vacancy,$60 insurance, $130 Lawncare, $11 Legal/Admin/Acct., $33 pest control, $133 property taxes, $10 Utilities common area light

NOI: $1118

PI: $757   *$143k loan , 4.875 30yr fixed

Cash Flow: $361/ month

Cap Rate: 9.4%

CoC: N/A, cash-out refi

Assuming 25% down, $35,750

$568 PI  *$107,250 loan, 4.875 30yr fixed

Cash Flow: $508/ month

CoC: 18.5%

It's a big remodel, do these #'s validate the headache for you? I could probably sell the property as-is and make $10k, maybe more on it and do nothing. Thanks for reading.

@Dawn Anastasi I have no intention on overpaying for the property, I am comfortable with my max offer. I'm more interested in how to best present a strong offer and anything I should consider or watch-out for in regards to dealing with Fannie Mae. For example, if me and another buyer presented the same offer, both all cash, but I provide a larger EMD would I get the property or would they ask us to bid again? Does FNMA have certain guidelines they are required to follow such as taking the highest bid regardless if it is cash or 203k? Would a no contingencies with higher EMD be the way to go?

I need some input from you pro's, I am bidding on a Fannie Mae house but I've never dealt with FNMA before and the agent I am using is very green so provides very little insight, but she brought the property to my attention so I feel obligated to go through her. Anyways, a property in my market was put on the market at a low price which in-turn induced a multiple offer situation (over 10 is what I'm told). I don't want to list exact #'s but I have determined my max price but am not sure how to prevent a strongest offer to fnma. Are they obligated to take the highest offer or do they consider terms? I've read about escalation clauses, large EMD's, etc. Also, in my search through BP I have read they can be difficult to deal with and can make many mistakes, should I enlist my lawyer to review all documents before signing? Any input from people that have purchased a home from Fannie Mae will be appreciated, thanks.

thanks @Erin Legler , I've got a couple more coming up I'll share when finished.

@Silvio L. thanks for the kind words sir, I've learned a lot of it on the fly.

@David Ward  I've had trouble finding GC's for a decent price so I've been piecing my team together and picking-up the slack on some of the general carpentry and labor myself. I've gained 2-3 good contacts with each project so it's just a process. Between trial and error and a couple of references from a local investor friend I think I've got a decent 3 man crew now to handle the carpentry and general labor on my next couple projects. I've been fairly close on estimating my rehab costs being about 10% over on each project so far. I'll continue track expenses and improve my accuracy.  

@Stanly Hernandez thanks man, feel free to bring some of that cash to East TN

@Terri Lewis thanks, it was major renovations and it turned out well. It always surprises how much a coat of paint or some fresh mulch can change the look of a place.

@Sandra Roddy I found the first one through an agent/investor friend, took her to lunch and she happened to have found it the day before. The package deal I saw a sign on the way home, set-up an appt. asap and made an offer almost immediately. There were 3 more offers the following morning and all of them higher than mine. I've had some good fortune but most importantly I just took action.

@Jason E. thanks for reading, I hope this story can push you to find that next deal!

Right on, congrats! Keep the ball rolling and build off the momentum.