From the BiggerPockets Blog

 BiggerPockets Blog »

Jump to Forum View All

Click a category below to view different forum categories.

BiggerPockets

General Info

BiggerPockets Q&A, Site Questions, & Announcements

1524 topics, 14454 posts — Last Post 04/24/14, 07:28AM

BiggerPockets Exclusive PRO Area

117 topics, 841 posts — Last Post 04/23/14, 08:28AM

New Member Introductions

10987 topics, 86590 posts — Last Post 04/24/14, 08:00AM

Real Estate Success Stories

399 topics, 6214 posts — Last Post 04/24/14, 07:46AM

General Real Estate

General Real Estate

Buying & Selling Real Estate

5993 topics, 47229 posts — Last Post 04/24/14, 07:58AM

Renters

650 topics, 5863 posts — Last Post 04/24/14, 07:43AM

Get Foreclosure Help - Help Stop Foreclosure Forum

317 topics, 2561 posts — Last Post 04/23/14, 08:28PM

Home Owner Association (HOA) Issues & Problems Forum

238 topics, 1611 posts — Last Post 04/23/14, 04:02AM

Do it Yourself

659 topics, 6320 posts — Last Post 04/24/14, 08:05AM

Reviews & Feedback

Real Estate Deal Analysis and Advice

3713 topics, 29770 posts — Last Post 04/24/14, 08:09AM

Real Estate Guru, Book & Course Reviews and Discussions

1139 topics, 11603 posts — Last Post 04/24/14, 07:05AM

Ask About A Real Estate Company

743 topics, 7344 posts — Last Post 04/22/14, 11:25PM

Real Estate Investing

Real Estate Strategies

Wholesaling

5639 topics, 43971 posts — Last Post 04/24/14, 07:57AM

Rehabbing and House Flipping

3354 topics, 31109 posts — Last Post 04/24/14, 07:10AM

Real Estate Development & New Home Construction

554 topics, 4695 posts — Last Post 04/24/14, 06:22AM

Innovative Strategies

705 topics, 6044 posts — Last Post 04/22/14, 04:06PM

Tax Liens, Notes, Paper, & Cash Flows Discussion

868 topics, 6694 posts — Last Post 04/24/14, 08:03AM

Rent to Own a.k.a. Lease Purchase, Lease Options

699 topics, 4947 posts — Last Post 04/24/14, 07:32AM

1031 Exchanges

143 topics, 1062 posts — Last Post 04/22/14, 03:21PM

Foreclosure Investing

General Foreclosure & Pre-Foreclosure Forums

1691 topics, 11313 posts — Last Post 04/22/14, 09:26PM

HUD, VA, and Tax Sales

416 topics, 3103 posts — Last Post 04/23/14, 02:29PM

REOs

1217 topics, 10604 posts — Last Post 04/24/14, 07:13AM

Short Sales

1539 topics, 13154 posts — Last Post 04/23/14, 08:25PM

Landlord & Tenant Forums

Landlord & Rental Property Questions

7253 topics, 71209 posts — Last Post 04/24/14, 08:05AM

Mobile Homes & Mobile Home Park Investing

639 topics, 5146 posts — Last Post 04/24/14, 05:13AM

Investor Basics

Starting Out

7733 topics, 60694 posts — Last Post 04/24/14, 07:10AM

Investor Psychology

432 topics, 6110 posts — Last Post 04/24/14, 07:56AM

General Real Estate Investing

4730 topics, 37327 posts — Last Post 04/24/14, 07:57AM

Real Estate Investor Marketing

1739 topics, 14152 posts — Last Post 04/24/14, 08:02AM

Commercial Real Estate

Commercial Real Estate Investing Forum

1413 topics, 9013 posts — Last Post 04/24/14, 12:59AM

Multi-Family and Apartment Investing

1123 topics, 9397 posts — Last Post 04/24/14, 06:46AM

The Business of Real Estate

Real Estate Technology and the Internet

Real Estate Technology, Social Media & Blogging

645 topics, 4913 posts — Last Post 04/24/14, 05:42AM

Business Basics

Goals, Business Plans & Entities

834 topics, 7588 posts — Last Post 04/24/14, 07:15AM

Real Estate Finance & Legal

Financial, Tax, and Legal

Tax, Legal Issues, Contracts, Self-Directed IRA

2802 topics, 20136 posts — Last Post 04/23/14, 06:57PM

Property Insurance

311 topics, 2057 posts — Last Post 04/23/14, 01:20PM

Personal Finance Discussion

330 topics, 2754 posts — Last Post 04/22/14, 12:06PM

Loans, Mortgages, Credit Lines

Private & Conventional Lending Discussion

2852 topics, 19849 posts — Last Post 04/24/14, 06:22AM

Creative Real Estate Financing

1221 topics, 8861 posts — Last Post 04/24/14, 07:55AM

Crowdfunding Real Estate

35 topics, 463 posts — Last Post 04/19/14, 06:24PM

Real Estate Professionals

Real Estate Professionals

Real Estate Agents

1217 topics, 8036 posts — Last Post 04/24/14, 08:09AM

Bankers, Lenders, and Mortgage Brokers

442 topics, 1931 posts — Last Post 04/23/14, 09:04PM

Contractors

269 topics, 1690 posts — Last Post 04/22/14, 07:33AM

Local Real Estate

Local Real Estate

Local Real Estate Networking & Recommendations

2017 topics, 11758 posts — Last Post 04/23/14, 10:03PM

Americans & International Real Estate

162 topics, 572 posts — Last Post 04/24/14, 03:31AM

Foreigners Buying in the USA

62 topics, 409 posts — Last Post 04/10/14, 06:27AM

Canadian Real Estate

66 topics, 440 posts — Last Post 04/24/14, 05:54AM

Marketplace

Real Estate Marketplace

Real Estate Marketplace

15085 topics, 54138 posts — Last Post 04/24/14, 08:03AM

Real Estate Events and Happenings

168 topics, 2608 posts — Last Post 04/24/14, 07:25AM

Off-Topic

Off Topic

Off-Topic

2907 topics, 32447 posts — Last Post 04/24/14, 07:23AM

Housing News & Real Estate Market

920 topics, 8391 posts — Last Post 04/23/14, 02:43PM

BiggerPockets Real Estate Investing Summit

97 topics, 1752 posts — Last Post 04/23/14, 04:51AM

BiggerPockets Resources

Forums » Buying & Selling Real Estate » Please review my deal analysis - Henderson / Las Vegas

Please review my deal analysis - Henderson / Las Vegas

10 posts by 6 users

Signup

· Las Vegas, Nevada


I'm currently under contract and there are several things I don't like about the place, but only grab it because inventory is hard to come by. This is a pocket listing I got from a realtor I work with.

1 Story Traditional Equity Sale.
1150sqft
3bed,2bath
Built 1983
Henderson, NV
Purchase Price $96k Cash
Rehab $6K
ARV $110k - $120k
Rental income $1000- $1100, (2% is hard to come by in Las Vegas.)
Walking distance from pretty good high school.

Things I don't really like about it.
- Small Kitchen
- Dining Room Table would be place in the kitchen corner which is only about 5ft x 10ft.
- Only standing shower in master bath, no tub.
- One sink in master bath.
- Normal sliding closet door in Master Bedroom.
- Electric Appliance, only water heater is gas.
- Garage is attach to the house, but you have to walk out the side door and get in the house via front door.

I could flip or rent, if I rent, I would get 9.5% Cash on Cash return, not including vacancies & repairs.

Monthly cashflow on rental would be between $855 - $955.

What do you think about this deal?



· Illinois


Monthly cash flow $855-$955 per month on $1000-$1100 rent? Where do I sign up!

Need to know the monthly taxes & insurance. Then can figure out if it's a deal. your vacancies & repairs would bring it down 2% I'm thinking so cash-on-cash return 7.5%.



· Illinois


i just did the math with the 50% rule. your cash-on-cash return is 5.5%.

you would have some equity though so your net worth went up instantly.



· Las Vegas, Nevada


Here the number I got that doesn't include vacancies & repairs.

Per Month
Property Tax: $60.25
Insurance: $51.50
Sewer: $18.81
Trash: $13.74
Power, Gas & Water: Tenant Pays
No HOA
No Property Manager (Self Manage)

Rental Income: $1000 - $1100.

Without vacancies, repairs, income tax, my pay back period would be 10.5 years.

Not my best deal, 6 months ago, my payback period was 8.5 years, but inventory is so low, hard to find that gem.



Real Estate Investor · Leawood, Kansas


If your cashflow numbers are accurate, renting would be the definite way to go. Since you paid cash, and there is not a ton of potential equity in the home, the cashflow will bring more income. Not to mention you are considering this a gem in your area, so you might as well hold onto it.



Property Manager · Henderson, Nevada


Hi Ace,
At least you could get one under contract!
Here's a few more things to think about.
1. Is the laundry located in the garage?
2. What type of roofing does it have? Asphalt shingle doesn't seem to last as long here.
3. Make sure you're looking at the rent rates for the immediate subdivision. Parts of Henderson can change quick if you cross a street or rail line.


Phillip Dwyer, Windermere Anthem Hills
Telephone: 702-212-1912
Website: http://www.vegasdigs.com
Phillip Dwyer Property Manager


· Las Vegas, Nevada


Thanks for the feedback @Phillip Dwyer!!!

1. Is the laundry located in the garage? - No, it's inside the house in the hallway area to the bedrooms.

2. What type of roofing does it have? Asphalt shingle doesn't seem to last as long here. - Tile Roofing, looks to be in good condition, but didn't really inspect it yet.

3. Make sure you're looking at the rent rates for the immediate subdivision. Parts of Henderson can change quick if you cross a street or rail line. - Yes, I looked on the MLS for the rental rates as well as Craigslist and Rentometer. $1000 is the low end.



Property Manager · Henderson, Nevada


In that case, it sounds like you may have gotten a decent price on this property considering the market. Good luck!


Phillip Dwyer, Windermere Anthem Hills
Telephone: 702-212-1912
Website: http://www.vegasdigs.com
Phillip Dwyer Property Manager


Residential Real Estate Broker · Las Vegas, Nevada


Have you thought about flipping it right away and keeping the rehab money in your pocket? Since you have equity and you can probably list it higher than comp value and still sell it. Due to low inventory and high demand you can probably find a desperate buyer.

With AB284 being reconsidered right now and talks of it being amended there will likely be new inventory introduced to the market soon. This will soften the market. To what degree is open for debate. I don't think prices will drop but they might. If they do you could buy another property and probably get a better deal.

With that being said flipping it now may allow you to sell high and then buy low again.

You can read a thread about the competitiveness of the current market here: http://goo.gl/csgZg

If you want to hear about the possible softening of the market then read this link: http://goo.gl/RJvvl


Small_rothwell_gornt_logo_smallRobert Adams, The Adams Team at Rothwell Gornt Co.
E-Mail: [email protected]
Telephone: 702-349-9175
Website: http://www.LVrealestateHELP.com
MA Contact info: 508-250-0345, [email protected] http://www.MArealestateHELP.com


Rehabber · Santa Clarita, California


First off, the rehab flip scenario some are talking about will return you little to nothing! With $102k posted all in and at best $120k resale, your $18k spread will go away with acquisition costs, holding costs, resale costs, and seller concessions. If you cleared $5k I would be surprised and there is no way in hizell I am investing over $100k to make $5k.

On a buy and hold, your gross rents of stated $1100 at best equates to $660 left over based on a 40% operating cost ratio (which is more of a better case scenario). That is a 7.7% return and you could easily do better than that more passively.

You also mentioned the 2% rule was not possible in Vegas. While I agree your market has gone super competitive and prices have increased double digit % over the last year, you can still do better than your 1% ratio.

Just food for thought.


Small_be_logoWill Barnard, Barnard Enterprises, Inc.
E-Mail: [email protected]
Website: http://www.barnardenterprises.com
http://www.InvestorExperts.com




Sign up