All Forum Posts by: Ted DeKowzan

There are 2 duplex buildings next to each other for a total of 4 units. They are identical buildings and each unit has 2 beds and 1 bath. The current rents are $750 for each unit for a total of $3000 gross income. The area is supporting $1000 rent per unit. I'm selling the contract to buy each building for $250,000 for a total contract price of $500,000.

Off Market Deal and not on MLS!!

Two beautifully maintained duplex buildings for sale. Brick exteriors with newer roofs. A sprinkler system waters the lawn and the owner has kept excellent care of the grounds. The interiors are a little dated but the tenants have taken excellent care and kept the units very clean.

Opportunity to raise rents to market rates near $1000 per unit. With some light remodeling and updates you can add value to the property.

Showings only to qualified buyers at scheduled times. Please don’t disturb the tenants. 

Contact Ted:

(720) 301-2585

[email protected]

EACH BUILDING;

Thanks @Dave Foster for the advise. The rentals are actually in Colorado Springs. I gave up on playing games with the sharks swimming around the Denver Metro. The timing to sell all the properties individually and find a replacement or several replacement properties could be cumbersome. Finding good deals is difficult and I don't think I want that much stress in my life. I'm considering a hybrid of refinancing the properties that can maintain decent cash flow and selling the "cash suckers" in order to 1031 into some additional "value add" rentals. 

Unless I get an investor that wants to buy the whole portfolio then there is less stress getting all the timing requirements to line up.

Cheers,

Ted D.

@Matt K. I appreciate the comment. I apologize if my post wasn't clear. I'm looking to refinance or sell the properties and participate in a 1031 exchange, one or the other. Although it has crossed my mind that I could refinance out a big portion of the equity, sell and if I didn't participate in a 1031 it would reduce my tax liability. Although, that is not my intent at this time. 

Hello BP Community,

I’m going to lean on you for some more advice. I own a portfolio of rental properties with a significant amount of equity. I was able to buy them below market rates and build more equity by rehabbing the units. They are renting well and provide a decent amount monthly of cash flow. Without considering any future appreciation, I feel that the properties have now reached the top of the market in value and rents. I’m currently in the process of a Cash Out Refinance with a local bank to gain access to the equity with the intent buy more rental properties. Even with competitive lending terms and rates this process will understandably create a significant reduction in cash flow and increase the loan to value percentage for the current portfolio of properties. By refinancing the current properties, I get to use the equity to buy 1 or 2 more properties. It’s my intention and hopes that the additional properties will offset the lost rental income.

I originally purchased the properties using the proceeds from the 1031 tax exchange. I had to pay the commissions and the 1031 escrow fees but I was able to take the capital gain from the sale of one property and roll it into 6 replacement properties. Here is where I get hung up. If I sell the properties and participate in another 1031 exchange I will have access to 25%-30% more equity than refinancing. This could now be used again to buy multiple properties all of which have the opportunity of forced appreciation through rehabbing and increasing the rents. I now wouldn’t have to carry a portfolio of properties that don’t have much room for appreciation and run the risk of being overleveraged.

I appreciate any feedback or personal experiences you are willing to share.

Ted

@Matt M. I appreciate the contact and will reach out to Bank of the West. 

@Teri Feeney Styers Thank you.... I will reach out to Caliber. 

@Corby Goade Your numbers are almost spot on for one of the properties. Although there are a few more things to take into account; Cost of appraisal, title fees, origination, and cost of repairs. Considering a 70% LTV refi I can recover some of the original capital invested but not all of it. With a 75% LVT I'm almost break even and at 80% I'm securing additional capital to invests.

@John Woodrich and @Aron D. Thanks for your input. These units mostly comprise of single sides of duplexes. I'm working on picking up the adjacent units. A good place to use the funds from the refinance. 

@Matt K. I would appreciate you connecting me with your lender. Even if it doesn't work in this case, I like to know what lending products are out there.