All Forum Posts by: Tyler Wenzel

@Douglass Belt Madison is not the market I'm actively searching, but a number of properties I have looked at were priced too high.  With the prices of real estate and the stiff competition, I've been wondering if the only way to truly find the great deals is through direct marketing campaigns.  Have you put any thought into that?

Also, have you looked into surrounding markets on the border of Dane County?  Those are typically a bit lower priced depending on where you look but most of them still commute to Madison for work everyday.

Just a thought Dougless, good luck!

@Syed Firoz Amanda is correct.  Renters insurance is for the renter, hence the name. 

 The big difference is that renters insurance covers all of the renters possessions in the case of a fire, theft, ect.

On the other hand, landlord insurance covers the structure and property that you own. Not the renters.

Hope this helps Syed!

Although this is cliche, I'm going to repeat and also say find a great deal on a duplex/tri/quad.  Obviously, if it doesnt cash flow, stay away.  But if you can get free housing for the year, plus some possibly, and then turn around and rent your unit out, that's some serious money you'd save during that year and great cashflow you'd make after.

It sounds like you kind of already have it figured out.  Now just put your efforts into networking and finding that deal!

Good luck! :)

Welcome Jarrett!  There are a TON of networking opportunities to be had here on BP.  Especially in your market.  A quick bit of advice, set up key word alerts for "milwaukee."  As soon as somebody mentions anything about that market, you'll be notified!

Again, welcome to the site.  Don't be afraid to ask any "dumb" questions, god knows I do!

Great advice @Douglass Belt 

I emailed the agent just now to verify that what he quoted was in fact a landlord policy and with what is covered.  He knew it was for a rental so I'm hoping he gave me the correct quote, but if not, that makes this deal even less attractive.  I think I'll still put in an offer, but obviously it will be much lower than what hes asking.  

Does anyone have any experience with creative financing and changing interest rates?  I'd like to figure out something that works in my favor but at the same time looks enticing for the seller.

@Account Closed  No recent appraisal from the seller.  That is from the tax appraisal.  I knew I shouldn't use it for final numbers but I guess I thought it would at least be close.  Definitely my mistake.  This is why I love BP.  How big of a difference between appraisals have you seen?

@Tanya F.

@Tanya F.@Account Closed 

Here are the numbers.  Leave me some comments if you'd like.

Asking Price: ~$200,000 (willing to negotiate)

Terms: 30yr amortization at 3% which raises after time (rate/time negotiable) with a 15yr balloon (also willing to extend if everything has went well)

Mortgage Payment: 843.21 (this is with 3% FIXED rate, so in reality, at some point it would be higher)

Monthly Rents: 885 + 865 = 1750/mo

Vacancy: 8.5% (seller says 0 vacancy)

EXPENSES:

Insurance: $41.66/mo  $500/yr (actual quote: $494)

Property Management: $175/mo (would be managing myself, but always build in property management)

Repairs and Maintenance: $300/mo ($150/unit, although the house is in great shape and will not need these kinds of numbers for some time)

Property Tax: $291.67/mo (a touch less than $3500/yr from tax records)

Sewer and Water: ~$50/mo (utilities came to roughly $43/mo on avg. Tenants currently pay sewer and water, is this typical for the area?)

Total Expenses: $858.33/mo

NOI: $742.92/mo

Cash Flow: -100.29/mo

Cash on Cash Return: -5.73%

As you can see, the numbers are not working for this property.  That is, with the numbers I've entered.  I realize my maintenance costs might be high, but I'd rather find a deal that can swing those numbers than to shoot myself in the foot later on. Thoughts?

In order to make this property cashflow at ~$100/door, I'd have to offer SIGNIFICANTLY lower, say ~$120000. Then there is the adjustable rate that I haven't even factored in yet.  The property appraises at $127000. 

Comments/Questions/Concerns?  Let'em fly!

@Jean Bolger Thanks for the response, I'll be sure to get all the details from him to find out if this is a cashflowing property or not.  Also, I'd love to hear what he has to say about vacancy rate and his typical tenants.  Google Maps says that this property is a 23 minute bike ride to the campus.

@Account Closed Thanks for the slap to the face :) Maybe that's what I need to start looking at this property as an opportunity instead of a problem.  In all honesty though, I was speaking about the area I live which is about 45 minutes south of Madison.  Of course, I could be completely wrong about this market as well :)  Just call it Newbie Syndrome!

Thanks K. Marie! That's part of the problem, Madison is NOT the market I've been learning.  I am there every day for work though so I do know the area decently, just not on a personal level.

In my area I wouldn't even hold a thought to a 1br duplex because nobody would ever rent it!

Hey all, I was approached last night about a seller financing deal for a 1/1 duplex in Madison, WI.  At this point I don't have the details to actually analyze the deal, but was hoping to get advice on exit strategies for a property like this.  Being new and not knowing the Madison market well, I could use the guidance.

It seems to me that being a 1/1 duplex, if I ever needed/wanted to sell, I might have a very hard time.

What I do know (And this is off the rental flyer that was passed on to me):

Rent: 865/mo/unit

Updated/Clean Property - from the pictures it looks newly renovated or well kept.

Large living room

hardwood floors throughout, ceramic in kitchen.

Off street parking

Neighborhood Park Nearby

Location: Near East High School

Again, I haven't talked numbers whatsoever since time didn't permit, but before I call to get more info, I'd like to get a good idea of an exit strategy.