All Forum Posts by: Sean Peters

Thanks everyone, the insights are very helpful! Sean

wow, thanks guys for all the awesome feedback! I'm excited to move forward with this and I now think I have a better idea of the reality of the situation. I will definitely keep you all posted with how I decide to proceed with the project. I am leaning towards trying to do a combo of selling off 1 condo and maybe keeping a couple as rentals..( I will be talking to a local real estate attorney to see how that could play out, and how much the conversion might cost)

I'm Wondering what people might do in this situation. I was able to find  a multi-family property in a good market that has potential to be converted into condos, or held as a solid income property.

If I decide to sell the property, After extensive renovations, ARV on the condos would be around $1MM total, I would be into the property for roughly $500K (purchase plus rehab), So the profit potential is huge!

If I decide to keep the property, I would rehab and refinance with a commercial lender. Annual NOI will be around $64K ...with a 10% CAP rate would value the property at $640K I would be all in at $500K which would leave $140K in equity. I would hypothetically not need to come up with any of my own cash to close the deal. Then I would own this asset which would produce around $2500 + monthly cash...

Either option sounds good to me, Just wanted to see if anyone has opinions/advice on which direction would be better suited for a young real estate investor building a business.

Depending on your budget, I would say Dover, NH! But if you want to spend more money you could come to Portsmouth

Thanks @Giovanni Isaksen, @Lorraine Pennington, @Barbara G.

Great advice, It definitely seems like everyone has a slightly different approach to 'stabilizing' a multi-unit like this. I like the idea of interviewing the tenants to see which ones could potentially pay more rent and are good to deal with, I wouldn't mind keeping them. I'm starting to lean towards keeping about half the building rented so I don't lose all my income, and renovate 1/2 at a time...

Thanks @Account Closed you definitely made some great points... I agree that it might be a complete pain keeping the original tenants so that is why I am considering that option. I definitely need to weigh the financial pro's and cons of going with that scenario.

I am offering on a 5 unit multi-family in a fairly stable rental market. I have been going back and forth on the best strategy to close this deal, whether to ask the seller to remove all tenants, or to purchase as-is with the current below market leases.

The property needs minor cosmetic improvements in all units in order to get full market rent. All 5 units are occupied with month-to-month leases. 

So...in deciding the best strategy, my big questions are:

1-Should I buy without any tenants? (if the seller is even willing to evict them)

2-Shoud I purchase with the tenants and then evict them all at once so that I can do the necessary renovations as quickly as possible and get all new full market paying renters I estimate I can renovate entire building within 8 weeks) 

3- Should I renovate the apartments one-by-one (I estimate this would take me 6 months)

I would really like to hear some thoughts on this situation! Thank you! - Sean

Hi Gary, Use the map-based search option when looking for comparables in NNEREN. It allows you to only pull listings that are in the specific area you are looking for... Let me know if you need more help!

As a recent business grad who jumped right into real estate, I quickly realized that I did not need my degree.. And learned a lot (enough to get started) by reading about 5 books... If you think that real estate is definitely the path for you, then I would say that it is not necessary to get into more debt for schooling... But you won't know until you get into it! I would say that even though I do not need a degree to do what I am doing currently .. I am still glad I got it. Who knows what path we will end up on 10 years from now!

I could also suggest Eugene Bilodeau at Cardinal Point Property Management

http://cardinalpointpm.com/

603-502-7630