In construction, there is only so much you can do to reduce your margins while staying profitable.

If you offer more than your MAO, you may not be able to sell the property to a cash buyer, your profit may be reduced, or you may not make any money on the deal.

This would help reduce the amount needed for a bridge loan to fund the acquisition and renovate the four vacant units.

Some might not be livable at purchase but 5k still seems cheap unless there is something off with the data. maybe the prices were reduced on unlivable properties due to back taxes being part of the deal for the purchase.

. $360k equity (based on your estimated loan balance and estimated transaction costs if you sold, this is not calculating capital gains taxes but that would reduce your equity down to about $310k if you sold without doing a 1031 exchange). $8k cash flow (this will increase over time because you are in an appreciation market). $6k principal pay down (based on your current loan). $20k appreciation (based on 3% which is conservative, 4-5% is the historical average).

Many local businesses that operate in the downtown area by the state park (including some famous attractions) close for the winter or reduce hours.

Diversifying geographically can also reduce risk and increase long-term returns.For example, there are several markets across the U.S. that are ideal for new investors because they offer affordable entry points, reliable cash flow, and strong economic fundamentals.

This reduces exit options and affects the value. 10) Small number of small units is the most expensive residential development there is.

Purchase price: $715,000 Cash invested: $297,000 Current Listed Price: $830,000Original Listed Price: $950,000 (4/13/2024)It has been reduced $120,000 in the las 6 months and hasn’t sold.

If he’s open to it, that could reduce the upfront capital you’d need while making the process a lot smoother.