All Forum Posts by: Dawn Roof

 I would say C area for sure. I was definitely going to use a Property Manager for this one, and even with an 8% PM, and 7% interest rate, and all the other things, it's still producing really nice cash flow. I just get nervous because the rents were raised from $450 to $750 on the 2 bedrooms, and from $550 to $900 on the 3 bedrooms. The seller says all the units, except one have been moved up to the new rent rate, and the last one is set to renew their lease at the new rate on 7/15. Is there some way you can fake this??

 The seller said no to viewing prior to a contract, so we don't disturb the tenants. My agent has assured me we can put in the offer that it's all contingent on actually seeing the units. I just wanted to see how you all go about verifying what the seller has stated for the gross rental income. 

It's actually on one parcel according to the city tax records, so it has to be purchased as one together, which unfortunately means a commercial loan. We have already found someone that will do the loan, with 25% down and 7% interest on a 30 year FIXED. No balloon payment. YAY! I don't love the 7%, but we certainly can't have a balloon payment. The purchase price is less than $500,000, so we had some difficulty finding a lender, but we have one now.

I'm new-ish to REI, with one single family home purchased last spring so far. That has gone very well, and we are looking at stepping up the game to a Multi Family. The one I have my eye on is 6 units (two triplexes next to each other) (4) 2 bed/1 bath, and (2) 3 bed, 1 bath, and based on all of the numbers I have run (multiple, multiple times) it looks AMAZING on paper. My main question, is how can you verify the numbers that the seller is giving you? I'm so afraid that they are incorrect, or just plain lies. This is a huge investment for us, and I don't want to make a terrible mistake. Another factor is that it's in a not so great neighborhood, but that has signs of revitalization going on. How do you guys make sure the numbers you are working with in terms of rent roll, and operating costs are good??? The seller has said that it's 100% occupied, and has been, but can't give me a history because they have only owned it since Nov of 2015 (they are flipping it; Did some repairs, and raised all of the rents significantly.)

I still have not seen the inside of the units, because we can't get in until an offer is accepted, but it's hard to make an offer, when you can't see what you are buying, and have to take the word of the seller at face value.  Any advice, on how you move forward, and how you verify the numbers would be greatly appreciated!!

What is your overall impression of this neighborhood? I have driven it, and I see a mix of cute, well-maintained houses with some kinda scary ones. Also there is a LARGE development going on between Wendover and Billingsley. They just tore down a large, low-income apartment complex, and some small SFH there. Is this a good "up and coming" spot? It's right next to some great neighborhoods with Eastover and Cotswold, so is it just a matter of time? Kind of all over the place, but just looking for your general impressions, and whether you would consider buying and holding a property there. Thanks so much!!!

@Jon Holdman, @Jesse T.

Hi all,

My numbers are based on the SFH Rental Analysis spread sheet I downloaded from this site. I have assumed a 5% Vacancy Rate, 5% for a maintenance reserve, $700 for property tax, Insurance $784, Mortgage $501 (4.8% rate with 20% down), and there is no HOA in this neighborhood. Purchase price should be $120,000-$123,000 based on market value, and rent will be $1050. I am planning on managing it myself. It's in a great school district Elementary 10, Middle 8, High School 5. It's 3 beds, 2 baths 1126 sq ft. They put granite in the kitchen and baths, new SS appliances, new flooring throughout, new fixtures through out. There's no garage, but there is a storage shed out back, in the fenced in back yard.

Looks so good on paper, right??

PS Not sure why my @mentions aren't working. I don't get a drop down box with names when I start typing them. :(

Thanks everyone so much for the input! We have not purchased this home yet, but I really like it a lot. My husband is dragging his feet, and I'm not sure why. I think he is using the lawn as something to keep us from actually pulling the trigger. This would be our first investment property purchase, and it is a big, scary deal for sure. Anyone have any thoughts on how to get him over the "Oh my god are we actually going to do this?" stage?? The house is really in good shape, and it should get around $325/month cash flow.  Any articles or other posts you could point me to? Thanks again!!

How much does a potential renter care about the appearance of the front lawn? We are looking at a property in a middle class neighborhood in Charlotte, NC, and the front yard has just been seeded and covered in straw. None of the other yards are pristine, beautifully maintained show pieces either. The house is empty, so no one is there to water it. The inside has been completely updated. New laminate floors and carpet, and new SS appliances and granite in the kitchens and baths. Really nice house! So would the lawn be a deal breaker in your opinion/ experience? My husband and I differ on this. He is worried that the yard will scare away all of our potential renters. Has this ever been an issue for you? Also, what about the maintenance? Can we expect them to water it? Would it be strange for us to ask them to take care of it? Should we get a service to take care of it until the grass is better established?

Here are some photos of what it looks like. Would this concern you? Would you feel confident you could rent it out?

Thanks so much for your help/input!!

Dawn :)

 @derek b

The HOA is minimal. One unit lists the HOA as $55/month, and the other as $35/month, so I don't think anything major is covered. Probably just the sidewalk or other common area upkeep. I don't know of any assessments, but I'll look into it. I did't allow 10% for vacancy, but I think I used 5% for maintenance. The PM rate is 8% of the total monthly rent, and yes, if they find the tenant, they take half of one months rent as a finding fee.

Thanks for looking at my photography!! It's a lot of fun! Hopefully that skill will come in handy on this real estate adventure too!

 Hi @sascha Weinberg

Thanks! I'm loving the community and all the knowledge here at BP.com!

The rent does seem in line with other nearby units.

The PM i'm going to use was recommend to me by a very good real estate friend of mine. As it turns out the listing agent for these properties is the same guy I would use to be the property manager.

There is a similar 2 unit place 1 block over that is under contract for $55,000 each, so that lines up too. Thanks for you thoughts!