Rental Property Investor · Overland Park, KS · Member since 2015 · 492 posts · 234 votes
Is it just me or are there no good cash flowing deals out there? I've been looking in state, out of state and all I find are $100/m at best. Am I analyzing myself out of potential deals? Here is how I run my numbers:
Investor · Janesville, WI · Member since 2013 · 180 posts · 155 votes
9y
I pay 6% for management fee's and they charge me $150 for lease signings because . . . . that's what my management company offered.
I actually borrow the capital and then pay all cash for the property (allows me to offer less and close quicker) and also pay cash for the rehab. After the rehab, I rent the place to a qualified tenant, then go to a bank, get the house appraised and put a mortgage on the property for the dollar amount I have fully vested into the project. I then pay back the borrowed money from the refi amount and now have no money into a cash flowing asset. (ie I just bought 3 houses for $55K last week, I'm putting about $20K into all of them, they should appraise at $100K combined and I will then put a $75K-$80K mortgage on them hopefully in January) These will rent out for $2300/mo of which the cashflow should be around $650/mo after paying the higher mortgage and expenses.
I buy in C class neighborhoods in Rock County, I can usually be all-in on a 3 bedroom house for about $35,000 and I will rent them out for $850-$900/mo. Duplex's are about $40K after rehab and rent out for about $600 per side.
Milwaukee has some major war zones and D class areas which I will completely stay away from, since I don't know those exact areas I haven't purchased anything in that city at this time. Everything I buy is not listed on the MLS, those prices have just gotten too high over the last year or 2. Out of the 26 properties I bought this year, only 4 were from the MLS.