All Forum Posts by: Tyler Wehrung

@Grant Rothenburger, nice meeting you as well! Yes, I'm projecting 950 a month at close and over the next year as I increase rents, I should be closer to 1300 - Almost halfway!

Thanks @Joshua Hilliard! I should be closing on the aforementioned property at the end of this month!

If your looking to buy a SFH as your first property with the intent to live in it for 12 months and then use it as rental, I would run the typical cash-flow analysis that can be done on the BP calculator.

If your looking to clear 100k a year, I would break that down into manageable chunks.  for example that's $8,333 a month. Assuming your properties cashflow $250 each, you will need about 33 properties.  Now you can start putting a plan to acquire x number per year until you reach your goal.  I wrote a post about how I laid my plan out and how I'm progressing on my five year plan to 5k a month in cashflow (link below).  I can send you the spreadsheet if your interested.

I would suggest house hacking a multifamily or the BRRR strategy if you really want to accelerate yourself towards your goals!

Good luck!

https://www.biggerpockets.com/forums/223/topics/480611-are-you-on-track-to-accomplish-your-goals

@Jeremy Anan

NOI is 53,551 based on a gross of 93,600. It is currently 100% occupied, and all units have separate electric & water. I have not verified numbers yet as I've just started to analyze the numbers, but I definitely plan on it.

@Tommy Spijkers

Thanks for your reply and advice on taxes and insurance.  I just spoke with my agent to get a ball park insurance quote and will look up the taxes, great point!

Hello BP,

I've been on the hunt for a 5+ unit building for awhile now and have finally found one in my local area (northern Cincinnati) that the numbers look decent on.  It's a little bigger than I was planning on, but I don't want that to be an excuse for me to walk away from it.

High level numbers:

12 units, asking price is 550k (I'm planning on 525K top dollar offer), rents are 650, has been recently updated.

Assuming 45% expenses - Capex- 10, repairs 10, property mgmt. 10, vacancy 5, taxes & insurance 10 (These are the numbers I use for my other rentals in the area) I should cash flow almost 1200 and have a 10% CoC return.

I should also add the terms that I'm pretty confident I can obtain with a local lender I have a relationship with. 25% down, 20 year amortization at 5%.

I'de like guidance, thoughts, suggestions on the items below:

- Is it wrong to assume the same expenses for multifamily as SFH's?

- I don't have the full 25% down, should I look for private money for the rest of the down payment or look for a partner? (this is probably subjective)

- Any other things to consider before making what feels like a major leap into a larger multifamily?

Thanks in advance!

Tyler

I debated posting this in "Success Stories" as I am only 20% of the way to my goal of $5,000 a month in cash flow by March 2021 (My 5-year goal that I established last March).  I decided to post here anyway since I typically come to this forum looking for motivation, aspiration, and to feed off of the success of others.  A lot of people I talk to have goals of having "a lot" of money, "decent" cash flow, retiring "early".  The common theme here is that they're not SMART! (Specific, Measurable, Attainable, Realistic, Time-bound)

Having SMART goals will give you a roadmap to where you want to be, provide instant feedback on progress, and allow you to measure and project your future to design the lifestyle of your choice.  I'm a visual person, so I built a simple, but powerful chart that I look at every day that shows my progress towards my goal.  I attached a picture below and if anyone is interested I will share the excel document with you to tailor it to your needs.  I wish you all success! Let me know your thoughts on this tracking tool.

@Mason Peacock

Yes, I use an app called DealCheck in the iTunes library and I like it a lot. You have to provide the numbers, but it calculates everything and gives you key indicators (NOI, Cashflow, expense ratios). You can also put your criteria in and it will tell you the max you can pay for a property to get say $200 a month in cashflow. Lastly it organizes all of the info into a nice looking PDF that I provide to my lender, who likes them a lot and I feel makes you look slightly more sophisticated. Bigger pockets calculator has some similar functionality, but I like to have the mobile access.

good luck!

Congrats on living below your means in order to take action! I wish you continued success!

Along with what Eric mentioned above...

Before your discussion with him, I would have all of your numbers readily accessible because I'm sure he will have questions.  I would recommend a nice report of the pro forma which you can use on the site here or there are also apps, but having a nice report will make you look much more professional.  When you do call him, I would present this deal as an opportunity to him instead of a favor to you. I think a lot of people feel like they're asking for a handout when they ask for private money, but keep in mind there are many upsides to the lender.  I would approach the conversation by letting him know you've found a great deal and you will be seeking private money to fund it.  Let him know you wanted to run the opportunity by him first since he's been so much help to you.  Then if he isn't interested ask if there's anyone else you could present the idea to before you move to your more extended network.  This approach has worked well with me and removes the awkwardness from the situation. 

Good luck, let us know how it goes!

I'm also in the military and purchased a property that just met the 1% rule. With a VA loan, you have to consider the fact that your getting into the deal for nothing... There aren't any other formal programs out there that I'm aware of to get into a deal for zero down. Although you don't want to purchase with appreciation being the only basis, low cash-flow / high appreciation deals typically have their advantages such as the examples @Anthony Gayden mentioned.

Some other things I would consider: Are you accounting for expenses? Will you be managing the property? Are rents below market? they seem low to me, but I don't know the area. Are their any value add opportunities? garages, laundry, storage, etc?

Good luck with what ever you decide!

Thanks @Brent Coombs! From everything I've read, you can get 70% of immediate appraisal OR purchase price, which ever is lower. I will definitely look into this further.