All Forum Posts by: Tommy DeSalvo

I do not have any experience with renting single families in Anderson, but I'm from the area and I think it would be a great place to rent a SFH. The school district is great, beechmont avenue is awesome, and the location is very convenient for getting to Cincy or the surrounding area. I've seen a decent amount of homes for sale in that area, so potentially you could make it a lease option. I've also seen plenty of houses for rent, so I would say see what houses are renting for and go for it!

Hey @Kyle H.

 The property is in Madisonville, a few minutes from Mariemont Square. I know the 50% rule is just a generalized rule, but the property hasn't been rented in years and as it's a bank owned foreclosure, there aren't any "real numbers" to crunch. I would be paying for heat. It looks like it's individually metered for water, gas, and electric. Each unit seems to be in pretty good shape. From my walk through is looks like they mainly need cleaned, paint, bathroom remodels, some drywall work, some new appliances. But nothing major. The two biggest things will be fixing the carport (it's falling apart) and repaving the driveway. I'm estimating a rough 15-20k for expenses. I won't be able to know for sure until I get it under contract and can do the due diligence. 

BTW it's great to meet another investor from Cincy!

Welcome to BP! This is definitely a great community to learn about what makes a good/great deal. Just keep reading and play around with the bigger pockets calculator, or play around in excel and you'll start seeing what makes for a good deal. I can't speak on behalf of the dublin area, but tri and quad plexes are renting just fine in the cincinnati area. Best of luck!

The bank reduced their asking price to 99900. I figured an initial offer of 2/3 that price wasn't insulting, especially considering the work needing to be done. The AMV is an optimistic view of how property values in the area seem to be heading and some similar comps in the area. Or rather, the AMV may be about 150, but I think the refinance appraisal will be for 160, since I've heard those often are higher than the AMV.

If there aren't other offers what is wrong with a 65% offer and seeing what the bank counters with?

Well, Initially it's going to be owner occupied, but in a year or two I'll probably refinance and roll that into either another FHA or regular investor loan. The reason I'm putting in a low initial offer is to give myself more room to slowly go up. I need to find out what the bank actually needs, not what they want. Also from what I've heard, there isn't much interest in the property and there haven't been other offers. I'm hoping it has been overlooked by other investors and this will give me a chance to spring board into real estate.

Yeah, that deal looks pretty amazing at their offering price. If you are expecting multiple other investors to bid on it, I would bid your best and highest right off the bat. Probably as close to the asking price as possible. If there is a bidding war, it'll probably go over the asking price.

Hello BP! I've made multiple offers this year, and I've lost on all of them, either to higher bids or all cash bids. Not much I can do there, but I just put in a new offer on a property and I would like to see how my numbers hold up to peer review. The more eyes on the deal, the better. Without further ado, here are the numbers:

This is a banked owned property. Originally listed at 104k. Price drop last week to 99,900.

At 99900 it has a cap rate of 12%. 

I'll be offering 65k, I'll have a FHA loan, and I'll need a 203k for about 15k for rehab.

I'll need 2800 down. 

Monthly Mortgage payment of approx 550.

4 x 1 BR units. Will rent for 525.

Gross income: 25,200

After 50% rule and mortgage that leaves about 6k yearly profit, or $125 profit per unit per month. 

The AMV will be around 160k. 

Thoughts? Are my numbers way off? How much does everyone think I can come up without losing too much cashflow? Advice?

Thanks for your time!

How many bed rooms per unit? What do you think each unit will rent for? Cap rate? That's just to let me run the numbers through my own spread sheet. What you should bid is dependent on a few things: How badly do you want this property? What is your highest price/ how well do your numbers work at your highest price vs the asking price? How well will this cash flow/ appreciate? Best of luck.

Welcome to BP! I would say with all the updating you've done to the property, it would be better to sell it, unless you can rent to a higher grade of tenants. If you do decide to sell it and buy a new rental closer to where you will be living, read articles like this and this.

Welcome to BP! It's a great place to learn and network. I would start with the BiggerPocket's Beginners Guide to Real Estate Investment. Also be sure to set up your Keyword Alerts. Enjoy and ask questions!