Hello everyone! I wanted to let you know that I am meeting private lender to get funded on my first deal!
Here is the property and the numbers per owner,
This property is turn key and ready to start making money. Doesn't need anything done to it. All units are occupied at this time. Only serious pre-approved buyers will be shown the property as I do no want to disturb the tenants. The triplex was built in 1942, it is located on the very south edge of Planeview. Each unit is a 2 bed, 1 bath with approximately 700 square feet. All units have been remodeled within the last few years. This included all new interior paint and flooring. 2 units have new furnaces about 2 years old, the other one is older but still works, which is why it's still there. One unit also has a new water heater about a year or so old. The exterior was painted about 2 years ago and I also put on all brand new steel doors with deadbolts. Again, this is pretty much turn key, just take over the leases and start making money. I currently rent one of them for $485/month, but that is all bills paid. The other two units are at $350, trash only paid. I previously rented them all for $350 with trash paid only. It all averaged out to about the same whether you do all bills paid or only pay trash. Trash cost $98 every three months. Property taxes are $380/year and Insurance cost me $439/year. I cannot owner carry this. You'll have to go to a bank for financing, which I'm asking $35,000. With any investment property, you'll most likely have to put 20% down. At this price, you'll need a $7000 down payment and you'll be financing $28,000 on a 20 year loan. At 5%, that will come to $184.79. Your total mortgage payment, which includes taxes and insurance will be approximately $253.04 (Depending on your rates). You'll also have to pay $33/month for trash. Total rents @ $350/month per unit = $1050. ($1050 - $253.04 - $33 = $763.96 per month of CASH FLOW). This is definitely a turn key cash cow. With the extremely low mortgage payment, you'll only lose money if all 3 units are vacant. As long as you have one rented, you will be able to make the payment and still put a little in your pocket. I've owned these since 2007, I'm selling because I want to consolidate my rental properties and get a few paid off.
Now I know the money numbers will likely be different due to the private lender option, this still looks like a good deal to me.
I have a question, First, what numbers would begin to make this deal 'bad'? Specifically with the private lender, what would be acceptable and when would I be giving up too much?
This is my first deal so I am traveling in new territory. Any advice for a total newbie that isn't scared of a 'no', but quite worried he might say 'yes' and not knowing that I should say no. Please help.
Apprehensively,
Douglas S. Jones
