Hi, everyone I need some help. I have been looking at properties and trying to educate myself for about the last year. I had decided on properties up to 4 units, with a purchase timeframe within the next year from now. I stumbled on a listing for an apartment building that has 14 units. They haves it listed for 300k. Here are my issues/questions:
Issue 1: As I said I was planning on buying within the next year so I am not financially prepared with the 20% down required to finance 300k. I can have 10% saved in the next 4 months if I start now.
Is there any method to finance 100% now?
I have a gross income of 90k and a 713 credit score. I sold my home in August and am currently stationed overseas with very limited expenses.
Issue 2: I am stationed overseas. My family would have to inspect the property and be my eyes on the ground there for up to the next 2 years.
Issue 3: The property has been owned and done managed by a local couple. Their records keeping is not good, and I’ve had issues getting exact data.
Question 1: How would I vet a management company from overseas?
Question 2: Would a management company handle the maintenance?
Question 3: How do I know it’s a deal worth making as my 1st investment or should I stick with my original plan of a 4plex to get started?
The only reasons I am considering this property is it’s location. As well as the fact I know for sure this area is lacking in small apartments so the demand for tenants is present.
Any advice on who to talk to or if I should even be considering this deal would be greatly appreciated. I have all the data they have sent me and would be willing to share with anyone willing to provide guidance. Thank You in advance!
A management company would handle the maintenance and oversee and minimize expenses. I don’t believe you will be able to get 100% financing. Wound love to look at the deal and help out more if you want to message me the details. Also I’m always looking to invest in case you need a partner. I’m a property manager here in Austin Texas.
@Aimee Wells you could probably finance it through a short-term, hard-money lender if the numbers make sense. You'll pay a much higher interest rate but then can refinance with a traditional lender after a short time. I would only consider this if it's a slam-dunk purchase. Because the owners can't provide solid data, I would be very cautious about taking that risk.
Even if your family "evaluates" the property for you, I would still recommend a second set of eyes. I can't speak for other Property Managers but I have evaluated properties for buyers in the past. I know the market better than they do, I know the things to watch out for with multi-family, and I can talk to the seller (or their agent) face-to-face and have better luck getting information.
The difficulty is that you don't have a relationship with a Property Manager so it may be difficult to find one willing to work for you and capable of performing the task. I normally refer people to www.narpm.org but I just searched and there is only one property manager listed for Iowa.
Another thing you can try: search the forums for members in the Red Oak area. There may be an experienced investor on BP that could work with you to research this, put eyes on the property, etc.
If you think it is a slam dunk, get it under contract where you can assign it to someone else. Then find a partner who can help you close the deal.
As for vetting a property management company, that can be done over the phone and also through online reviews.
Thank You everyone for the support and advise! I definitely will be having a professional look over any property I choose to look harder at. My family will more be my eyes on ground for initial evaluation much the same as I would do if I were there. Thank You again!
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