It’s crazy how I used to stay in a triplex I had a dream bout the other night. Something told me to call my ex landlord and see if he was selling his triplex because I left on good terms with him. He told me he would sell it for 100,000. The market it’s in is Palatka Fl, 32177. I have 5 steps to approach this...
1) I have to keep saving my money, working 2 jobs, building credit. Paying off my credit card on time every month along with other bills. Pay collections and get the listing off my account. Once I have good credit and up to 20% of 100,000 saved up I can begin this deal...
2) I need to see how much rehab needs to be done. (ARV) then run my numbers (Cash flow) see how much are expenses. Run cash on cash return. Use www.biggerpockets.com/calc. Good deal or not?
3) Find our what kind of loan will I use. FHA, 3.5% down? Conventional loan, 20% down? Private lender? Hard money lender? Or seller Financing paying 20% down preferably? Purchase and sell agreement if he accepts SELLER FINANCING. Do rehabbing if needed.
4) Open another bank account for rental property. Put 2-3 months worth of rent in it. Make lease agreements, $5 a day if rent is unpaid. 5 dollar application fee. (Credit checks, employment checks.) Do open houses at one time for all future tenants. First and last, security deposit.
5) Marketing. Post on Facebook, Zillow and everywhere you can imagine. Advertise your property to the max. Possibly see an real estate agent, and keep growing...
This a good start? May be out of order, but I have to run the number to see if it’s cash flow positive. Honestly think it is, location is great. Next to all stores and next to the St Johns river. Please interact.
As you figured out, first steps would be to determine if it's a good deal. To do that, you need to know how much rehab it would need and how much rent it would generate. Also knowing the expenses is important.
When you have that info, we can assess whether it's a good deal and go from there.
@J Scott The building isn’t vacant right now. It has tenants in it. The landlord told me I could easily rent the 2 2 bedrooms on the bottom floor for 700 a piece and the one on top for 500. The one on top is a one bedroom, but it has a whole balcony on the roof! I wanted to put some work into it to raise rents... it looks rough on the outside, but there are tenants in it currently as we speak. Please interact.
@Trellis Alexander Don't take the landlords word for potential rent numbers. Ask for historical rent information on the place if it's available, check rentometer.com and do some comps on rentals in the same area.
@Scott Rogers thank you so much
Do your own DD. Never rely on someone else for that. You have only yourself to hold accountable.