All Forum Posts by: Account Closed

@Snehann Kapnadak Thanks for all the great info! I am also considering using Pinnacle TK. How is your overall experience after almost 2 years now? I understand that they use Douglas J. Hannah property Management in KC right? How have they been to work with so far?

Thanks!

@Nicole Heasley Beitenman,

Gotcha, thanks!

@NicoleHeasley,

Thanks for sharing! So it seems that with repairs, MX, and vacancy you are sitting at 25%, which is what most people end up close to.

My question for you is: with those metrics, what type of cash flow per unit and Cash in Cash return are you looking to see before you buy a property? 

To me, if someone is using 10%/10%/10% and looking for a 5% ROI, that is almost the same as someone else using 5%/5%/5% and seeing 13% ROI for example.

Anyone else chime in please!

@Mike D'Arrigo,

Thanks for the input! Absolutely agree on the variation in CapEx and vacancies, just interested in what people are crunching numbers on as a general rule.

@Alyssa Dyer,

Thanks for the response!  Interesting way to do the numbers, by holding cash reserves and just removing it from the calculus of Cashflow, ConC, Cap rate etc.

And good point on the Cap rate, that is obviously a clear metric along with ConC to compare apples to apples on a property.

When you  both say vacancy varies, I agree, but when you are evaluating a property to decide if you want to buy it, are you using the vacancy rate from your property manager, the Turnkey provider, or some general knowledge you have from elsewhere (experience)?

@Scott Passman thanks for the real world info. I am looking do buy Turnkey most likely so I appreciate the comparison.

It makes sense that the CapEx would be lower for a renovated home (TK) or a newer build.

Have you found it challenging to find turnkey properties that will yield 10% ConC using those metrics and cash flow minimum? Up to this point I have been trying to hit those numbers when analyzing take properties, and it seems quite difficult, even in different areas.

What market are you TK investing in if you don't mind?

Hey Jason,

Thanks for the detailed response! That super helpful. I hear what you mean on the Vacancy and PM nunbers make sense. I hear what you are saying on CapEx too, cause i guess a water heater or roof on a house getting $2000/month in gross rent will really cost about the same as on a house yielding $1000 gross rent.

When you said $150 per unit cash flow with zero down, and you would not "buy the cashflow" do you mean you calculate as if you have no cash in the deal, or do you actually not put any cash into the deal?

BP Family,

I am poised to have the cash for my first Turn Key (or close to turn key property bought through conventional means), and I have a question about the numbers on deal analysis, as I have been analyzing tons of properties, and want a standard metric to use so I hold my standards.

I have seen people use everything from 5% for CapEx, Vacancy, Repairs, 10% for Property management, and just use real numbers for taxes and insurance (the big 6). I have also seen people just use the 50% rule only. I have also seen folks use 6%, 7%, 8% 10% etc for the "big 6", and any combo of those.

I would like to hear from current property owners with buy and hold rentals specifically about:

1. What numbers do/did YOU use for success (CapEx, Repairs, PM, Vacancy)

2. What is YOUR minimum "go" criteria for (a) Cashflow per door and (b) Cash on Cash return on an investment property (assuming 20% down financed)

Look forward to hearing what other have used with success in their buy and hold portfolios, thanks!

BP Family,

I am poised to have the cash for my first Turn Key (or close to turn key property bought through conventional means), and I have a question about the numbers on deal analysis, as I have been analyzing tons of properties, and want a standard metric to use so I hold my standards.

I have seen people use everything from 5% for CapEx, Vacancy, Repairs, 10% for Property management, and just use real numbers for taxes and insurance (the big 6).  I have also seen people just use the 50% rule only.  I have also seen folks use 6%, 7%, 8% 10% etc for the "big 6", and any combo of those.

I would like to hear from current property owners with buy and hold rentals specifically about:

1. What numbers do/did YOU use for success (CapEx, Repairs, PM, Vacancy)

2. What is YOUR minimum "go" criteria for (a) Cashflow per door and (b) Cash on Cash return on an investment property (assuming 20% down financed)

Look forward to hearing what other have used with success in their buy and hold portfolios, thanks!