First deal in MD: Looking for feedback on off-market property

4 Replies

So BP has proven to be an extra valuable resource so far for a newbie like myself so I'm hoping some of the more experienced folks here can give me some feedback on an off-market property I'm looking at.

The figures below are the numbers from a broker with a pocket listing so they have yet to be verified. It was previously on the market and didn't sell (possibly for good reason, I will be checking it out next week).

AP: $110,000 but I'm told that it was brought down to $98,000

Income: $1,300/month, currently rented to a long term renter

Taxes: $2,598

P&I (based on 25% down on $110k -from broker): $430/month

Insurance (budget # from broker): $700/year

R&M: $1,000/year (I'm a little skeptical of this)

City registration fees: $65/year

Tenant pays utilities. 

No idea what shape the CapEx items are in.

Any feedback is greatly appreciated. I will be looking at comps this week to get an idea on pricing. Thanks BP!

Originally posted by @Marc M. :

So BP has proven to be an extra valuable resource so far for a newbie like myself so I'm hoping some of the more experienced folks here can give me some feedback on an off-market property I'm looking at.

The figures below are the numbers from a broker with a pocket listing so they have yet to be verified. It was previously on the market and didn't sell (possibly for good reason, I will be checking it out next week).

AP: $110,000 but I'm told that it was brought down to $98,000

Income: $1,300/month, currently rented to a long term renter

Taxes: $2,598

P&I (based on 25% down on $110k -from broker): $430/month

Insurance (budget # from broker): $700/year

R&M: $1,000/year (I'm a little skeptical of this)

City registration fees: $65/year

Tenant pays utilities. 

No idea what shape the CapEx items are in.

Any feedback is greatly appreciated. I will be looking at comps this week to get an idea on pricing. Thanks BP!

 What about Schools, Crime, Price & Rent trends in past 12 months and also foreclosure rate in the area? Don't buy just based on numbers, the rest needs to pan out too. Your tenant might move out and you might have troubles renting out again if area degraded in past few years. Do you have the cross streets as well as property type beds/ba/sqft? I can give you a more detailed analysis.

Originally posted by @Bogdan Cirlig :
Originally posted by @Marc M.:

So BP has proven to be an extra valuable resource so far for a newbie like myself so I'm hoping some of the more experienced folks here can give me some feedback on an off-market property I'm looking at.

The figures below are the numbers from a broker with a pocket listing so they have yet to be verified. It was previously on the market and didn't sell (possibly for good reason, I will be checking it out next week).

AP: $110,000 but I'm told that it was brought down to $98,000

Income: $1,300/month, currently rented to a long term renter

Taxes: $2,598

P&I (based on 25% down on $110k -from broker): $430/month

Insurance (budget # from broker): $700/year

R&M: $1,000/year (I'm a little skeptical of this)

City registration fees: $65/year

Tenant pays utilities. 

No idea what shape the CapEx items are in.

Any feedback is greatly appreciated. I will be looking at comps this week to get an idea on pricing. Thanks BP!

 What about Schools, Crime, Price & Rent trends in past 12 months and also foreclosure rate in the area? Don't buy just based on numbers, the rest needs to pan out too. Your tenant might move out and you might have troubles renting out again if area degraded in past few years. Do you have the cross streets as well as property type beds/ba/sqft? I can give you a more detailed analysis.

You raise excellent points. That's what I'm researching now but it's in a neighborhood just a few blocks from a "ritzy" area with comps in that area of $350k-750k ARV. I'm in the process of looking at crime rates and school data. I will PM you the additional information per your request.

Originally posted by @J Scott:

Marc - If you post the specific area (or PM/email me the address), I may be able to provide some insight.

The big things you should verify early on:

- Market rents (is $1300 anywhere close)

- Any deferred maintenance

- Is the tenant current on rent?  Have you seen the lease?

J, sending you an email now. $1,300 is definitely in the ballpark, though appears to be on the upper end of the spectrum. Not sure on deferred maintenance or CapEx but I'll hopefully find out next week. Also don't know whether tenant is current but I will be asking this and for a copy of the lease before closing.

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