All Forum Posts by: Viktor Zguro

I found a property for sale in West Hartford. It’s a 3 unit building with 3 bedrooms and 1 bath on each floor. Each unit is about 1500 sq f. The rents are strong and it’s a few streets away from the busy Farmington Ave. Owner is getting 1800/1850/1990 for the units and has been getting those rents for the past 3 years. Seller is asking 640k but it also includes a piece of land that’s zoned for a residential property. You can build a duplex on this land, but the seller says it doesn’t meet the requirements because it’s a bit narrow and you’d have to apply for a variance. Basically it doesn’t have much value to me at this point in time. I think she’s asking wayyy to much for the total package. The property taxes are 14k and the insurance is 300$ a month!!!! I’m from Worcester MA and I own a few multi families and our property tax and insurance is half that and we get about the same on rent, a bit more actually. Why are the property taxes so high in CT? I really like the Farmington Ave area where all the restaurants are, and the schools are rated really well…. But the taxes are just a killer. At 20% down/4% interest, it still cash flows like 7k a year, but those taxes eat away at another 7k of potential net profit yearly. That taxes realistically should be about half of what they are now. Is CT addressing this issue? I assume this deters many investors from CT and I can also assume that CT is 100% trying to change this because it’s going to drastically limit their growth. I’ve yet to see the unit in person…but I love the area, the schools are great, the average HHI is 100k+.. it’s a great area to have a rental, it’s just the tax that makes this risky. 

Is this deal worth it? Imo I don’t think I’d offer more than 550k. 640k is way to high considering the property taxes. 

After viewing the house a second time, I figured out the basement unit was not a legal 2 bedroom... its a legal 1 bedroom. Seeing it a second time, I just didn't like the house at all (too small and weird layout) ... I passed on the house. I've learned that I need to see a place 2 times before making a decision and that I need to bring someone with me to give a second opinion. I saw this house right after seeing a potential rehab project and this house looked amazing compared to that... that probably skewed my interest.

The credits were an outside part of the deal, it was not included in the loan documents. It was never mentioned to the lender. RE agent said he does this whenever he can to remain liquid and not tie up too much cash into the house. Not sure why credits back to the buyer would have anything to do with the lender? What a buyer and seller do outside of the loan terms is none of the banks business imo. Not sure if its illegal or not, but I honestly never even heard of this idea until the RE agent brought it up.

I'm having a hard time finding a solid investment property in Worcester MA, so I thought I'd check out RI, but I really don't like RI at all. Every place I've been to looks a lot like the "bad" areas of Worcester. From what I can see, the multi's on the market right now are landlords unloading on their property that they've never cared for/renovated. They're basically trying to pass on all the work to the buyer and still charge full market price for the house, it's insane.

The 21k credit was my agents idea, super smart guy (owner has already agreed to either one of the options above, I just need to put my deposit down). I have a friend renting his 3 units in Woonsocket for 1300 each. If he can get 1300 in Woonsocket, I feel like my numbers are very conservative.

I'm currently negotiating an offer for a 4 unit home in Johnston RI. I've been working with a really smart agent and he recommended Johnston as one of the nicer areas in RI for multi family investing. All separate electric meters and gas, water is included. Currently there are 2 bedrooms in each unit. The first 2 units feature double parlor/living room, which can very easily be closed off and made into a third bedroom. The third floor has 2 bedrooms and an extra room (same size as both of the bedrooms) being used as a living room. I consider it a bedroom, so technically the third unit is 3 bedrooms. The 4th unit is in the basement and features an open concept kitchen/living room and has 2 bedrooms. Very solid house...needs absolutely nothing. You could just freshen the place up a bit with some new paint and carpets 

The units are currently occupied and they're paying about 1k per month in rent. From the research I've done the first 2 units should be able to collect at least $1500-$1650, the third floor can collect at least $1400-$1500, and the basement unit can get $1200-$1350. Like I said units are in really good condition and need absolutely nothing. Guy across the street is advertising his renovated units for $1750 (3 bed, 1 bath).

*One unit will be occupied by me*

The current deal(s) I have negotiated -

Purchase Price: $518k

Credits: $7k credit for closing costs (from owner)

Financing: 3.5% down ($18.1k down)

or

Purchase Price: $539k

Credits: $7k credit for closing costs (from owner) and $21k credit to my pocket (cashiers check).

Financing: 3.5% down ($18.9k down)

Essentially, I get my down payment back and have no skin in the game. Yes, I end up paying a bit more in interest over 30 years, but I can just refinance after year 1 bring my mortgage down. I'd rather have my cash back and use that to put into another property, instead of having it tied up in a home.

Looking for some insight from anyone that has property near North Providence and Johnston. I know Johnston approved a new Amazon Facility over the summer, will add at least 1500 jobs. What are you thoughts on the deal? What could I pull in for rent?