All Forum Posts by: Wade Sikkink

We just bought a 14 plex with 1 vacant unit. We made all the tenants sign a new lease with us, but one tenant is pushing back. Apparently he's a lawyer and wants to make a bunch of markup's to the lease, which I'm not crazy about.

Question is, do you really need to put new leases in place? This guy has a lease with the previous owner (no markups and strikingly similar to mine) and that lease was legally assigned to me at the closing by the seller. I'd like to know what everyone else does when they buy a property with tenants in it that they want to keep.

I agree with Joel. Local or state banks are the ones that will likely want to play ball on deals this size. We just bought a 14 plex for $335k. I have a relationship with my local banker for another business I own, so he gave me the go ahead to make the offer after showing him the numbers. I dealt directly with the sellers agent.

Just keep looking and you'll find something. The property we just bought kind of fell in our lap via a dinner conversation with a family member. We didn't even know if was for sale. 2 months later we closed on an apartment building (using home equity for the down payment). Cool things often happen when you least expect them.

Keep your chin up and your powder dry.

I didn't catch that angle. If you can do the re-fi on those terms, then yes, $300/mo. cash flow on a -$2000 investment looks attractive. Not exactly higher math.... :-)

Using the 50% rule you would have $1200/mo NOI. If you put 20% down overall at 5.5% you would be looking at about $526/mo. debt service. That leaves cash flow of $674/mo. or about $168.50 per door. Not bad. If the deferred maintenance can be deferred a bit longer you can pay for it out of cash flow over the next year.

Tying up $45k to make $300/mo. cash flow seems light. I would think you could find a duplex/tri/quad that would produce more cash flow for the same or similar investment. Our first quad we put $54 down and it cash flowed $1200/mo. and was very easy to keep full.

For me, I'd pass and find something else that gives a better return.

If you've run the numbers, then you know what you can pay. Don't get excited and caught up in the activity. Submit whatever your numbers tell you to submit and let it play out. It doesn't really matter if there is another offer. Let the data guide you. Better to lose a (potentially) good deal than get a bad one.

@Eric, YouTube is a great source of info. I also have bought several books. You can also find great forums on specific topics out there. I'm putting a tiled shower in my own basement and had a couple questions about putting in the pre-slope for the pan. I went to HD to ask the tile guy there and ran into a guy in the tile isle that is a professional tile installer. We chatted for about 10 minutes and he answered all my questions. Got the pre-slope mortar installed the next day.

In our county you can look up sale information on the county assessors site. It lists tax assessed value and all recent sale information. Maybe it's just in a different area on the website? The website in our county is not real easy to navigate.

Welcome Nicholas! Good to see more NE folks on here.