All Forum Posts by: Josh Butler

@Matt Todd Are those limits on number of unrelated persons because those cities have universities within their boundaries?

@Alecia Loveless Thank you for sharing.  Bigger pockets is a great resource, I was involved with it several years ago and then stopped for a while.  Wish I had kept going!

@JD Martin A fellow musician!  Is music your regular career?  I would love to pursue music more fully.  Also I see you were a podcast guest #243.  I don't think I have gotten to that one yet I will have to give it a listen.

For anyone that was able to quit their 9-5 and move full time into real estate (or something else) I'm curious to hear your stories.  How did it play out?  What was it like?  How long did it take?  What did you learn?  I've set goals around this and looking for inspiration from people that have done it.

@Michael Garcia 

Good points.  I had thought that with an income producing property, it's value was largely based off of how much income it produces.  But maybe that's different for something smaller like a 4 plex?

And yeah, the interest rate difference was also a concern given the likely rise in rates that will happen.

The numbers I posted were without me living in it, but this would be an owner occupied unit (at least initially) so I would be paying some of that myself as a 'renter'.  It isn't exactly high lifestyle living so I wouldn't live there forever.  Just enough to do some fixing up (which is also needed).  

My desire to 'get on base' is probably overriding the logic behind getting on 'this particular base'.  The funny thing is there's an adjacent 4 plex right next to this one that is also for sale, and there's an investor (newbie as well) who is completely gung ho about it.  Same sale price...condition of the unit....everything is exactly the same.  He either does not know what he is getting himself into, or will be able to make it work and I'll still be looking! 

@Ed S. 

Yeah it would have to happen after having 25% equity.  I figure if I were to raise the rents up to 900-950 over the next year or two, and pay down the mortgage, after my 3.5% downpayment I would be pretty close to 25% equity.

@Albert Bui thanks for the response Albert.  Yeah I would definitely be ok buying something at a discount.  We're trying to get the seller to go lower but not sure what kind of luck we'll have.

Hey guys, I'm back with another 4 plex eval...I know it's not as good as other areas but I'm really perplexed with what to do.  Some of you will talk sense into me I'm sure but that's why I've come here!  Curious to hear what you think:

Purchase Price - 397,000

Rental Income - 3250

Mortgage - 2400 (FHA - PITI)

Water/Sewer - 180/month (for the whole building) (paid by owner)

Dumpster - 70/month (paid by owner)

Management - 300/month

Once again, I know these numbers aren't as good as other areas.  Salt Lake's market isn't so hot for buying rental units (especially if you don't have a ton of money).  These numbers only squeeze out a few hundred dollars each month (if even).  BUT...the reason I'm considering it is because of the purchase price...I think an appraisal could come back significantly higher than 397 (probably 430 or so?) especially if we're able to raise the rents.  If I could refinance into a conventional loan in a year or two then all of a sudden the situation gets a whole lot better.  

I've been looking for a multi-unit now for 6 months and am anxious to get something going in real estate (this would be my first deal).  Would it be worth going through with it even if it's not incredibly profitable for the first year or two?  Or should I just hold off and pick up a single family home with some roomies?  There just isn't much opportunity here for me!

Hi Janine, i hate to discourage, but I have been looking pretty intensely for a multi family property for the last 6 months with no avail.  Our market is tough for finding good rentals!  (at least as a newbie like myself)

Yeah the payment does include the taxes and insurance...but property taxes as I understand only go up each year.  A few years down the road my minimal margin becomes a nonexistent margin...There isn't much wiggle room.  I'll talk to my agent though about getting that kind of agreement from the listing agent for future deals we look at.  I didn't know that that was an option.  Thanks for your help everybody!

@Zack H. Thanks for your response.  That mortgage payment is after a 3.5% downpayment...is it reasonable to expect deals with a better rent/payment ratio even if I'm only putting 3.5% down?  Salt Lake is a tough area...I could always put down more and lower it, but I'm trying to keep my reserves so I can buy other properties after buying my first one.