For this deal to work under those conditions, the purchase price would need to be closer to $179k.With your original assumptions 249k, the deal is marginally acceptable but not great, given the negative cash flow in the early years.

It was in rough condition, which limited competition and made it a strong candidate for the BRRRR method.Negotiation: After analyzing comps and repair costs, I negotiated a $420,000 purchase price, which was below the market value for similar properties in the area.

Do the condition of the units match market rents?

I’m back now and looking for some guidance on an idea that caught my attention.An old high school friend of mine has been buying older houses, either renovating or tearing them down and rebuilding, depending on their condition.

However, in emergencies or cases involving health and safety, we would attempt to contact the owner first and, if unsuccessful, proceed with the repair as outlined in the contract.Regarding the hot water heater, do you know if it genuinely needed to be replaced?

Will likely take longer to close than a traditional hard money (they have to order an appraisal, satisfy lender conditions etc..).

Prioritize stable cash flow, good location, and manageable property condition, while considering strategies like gradual rent increases, expense reduction, and value-add improvements to enhance returns.

This property had significant potential for value enhancement due to its location and condition.

They’re fully renovated (or in good condition) and often come with tenants already in place, so you can start making rental income right away. 

Plus, multifamily properties often qualify for owner-occupied financing options with lower interest rates and down payments.As for timing, here are a few things to consider:Market Conditions: Keep an eye on local market trends.