Hello everyone! My name is Hyrum. My wife and I are brand new at real estate and are working to get our first deal by the end of 2019. I have been looking at properties for months and just recently started working with an agent to get to know the market in our area in the Idaho Falls/Rexburg area. We became pro members a few weeks ago and have been using the calculators the best we know how. Our biggest obstacle is financing because I am a college student and might not be able to work full time because of class schedules. I have attached a report of a property near us using the BRRRR calc and it seems like a pretty great deal, but I am not certain that I am using the calculator correctly. Please let me know what advice any of you have, or let me know if you are in my area and we can meet up and get to know each other and look at a possible partnership.
*This link comes directly from our calculators, based on information input by the member who posted.
@Hyrum Stonehocker You posted this twice it seems. I responded in your other post. Would love to meet up and see how I can help. There is a local REIA meeting here the 2nd Thurs of each month in IF at the ISU Credit Union on Sunnyside next to the hospital. Starts at 7, networking at 6:30. I rarely am able to make it with many other things going on but it is always good.
The vacancy looks a little low but that is very market dependant anyways. I usually run a calculator assuming a 1 month vacancy on every unit once a year (8.34%). Not sure what the rates are on commercial loans but 4% seems a tad low also. Even then this building looks like a great buy! What class property is it ?
$1000 / month for coin operated laundry?
That seems a tad high.
@Hyrum Stonehocker A few questions / comments as I own an apartment building:
- Can you clarify what you mean by 4 units, possibly 8? I see a rehab budget of $30k;if you're planning on converting 4 units to 8, IMO it will be far more expensive than that.
- Agree with above posts, if it's 8 unit, it will be a commercial loan, probably closer to the 6% rate, and 15 or 20 year term.
- Insurance is high for apartment buildings. Mine is a 5 unit and insur = $2900/yr.
- Assuming it's $1k per year (not month) for laundry ?
- Even a commercial loan will require a personal guarantee, so they will look to your financials as well.
@Hyrum Stonehocker Just following up on my questions, as I didn't hear anything back from you.
You are all right that I was not using the calculator very well. Tom S. I’m under the impression from the listing that it is currently 4 units that are rentable and they look nice. But there are two other apartments framed in needing to be finished. The basement also has space for possibly an additional 2 units which would make 8 total after renovation.
Thanks for the insights. I was missing many of those things, so thanks for the help.