20 unit property, deal advice

[AJ Angel]

Im going to be buying a 20 unit apartment property.

im doing seller financing with 15% down on a 395,000 price with a 6% interest

monthly rent total is $8,215 when fully occupied, 17/20 are rented

monthly expenses:

water-1100

landscaping- 200

taxes-226

insurance-70

future property management -600-700

seller payment- 2400

total is 2500-3500 (set aside 25% for repairs and vacancy of that. total)

cash flow around 1800-2600

the property is real low maintenance, no washer/dryers, building is cinder blocks with concrete flooring,

there is more story to the property but this is just a rough snap shot of it.

good deal or no deal? thank you

[James Wise]

Originally posted by @AJ Angel:

Im going to be buying a 20 unit apartment property.

im doing seller financing with 15% down on a 395,000 price with a 6% interest

monthly rent total is $8,215 when fully occupied, 17/20 are rented

monthly expenses:

water-1100

landscaping- 200

taxes-226

insurance-70

future property management -600-700

seller payment- 2400

total is 2500-3500 (set aside 25% for repairs and vacancy of that. total)

cash flow around 1800-2600

the property is real low maintenance, no washer/dryers, building is cinder blocks with concrete flooring,

there is more story to the property but this is just a rough snap shot of it.

good deal or no deal? thank you

 The price per unit & the fact that the seller will carry the whole thing tells me that 1 of 2 things are happening here.

• This is the greatest deal of all time. You should not be talking because you should be busy signing papers.

• The property is in the hardcore ghetto & the seller just wants to dump it. He wants to dump it not because he needs cash, but because it's a horribly difficult property to manage. This is evidenced by the fact that he is willing to carry with such a low down payment. If he just needed cash he wouldn't carry it.

With those 2 things in mind your entire analysis is missing the ball. You are running through the numbers then asking questions. Bro those are the greatest numbers ever, your financing is insanely good. That's not the issue. The issue is can you actually collect & manage this tenant base?