[Calc Review] Help me analyze this deal
*This link comes directly from our calculators, based on information input by the member who posted.
@Juan Ospina do you know what your numbers mean on the soft costs. Vacancy of 2% is 1 month out of 4 years and 2 months. Not likely. I use 8% or 1 month out of 12. I use 5% repairs vs your 4%. My capex includes but not limited to: roof 25 year life span, floors 10 year life span(except carpet only 5 years), appliances and hot water heater 12 years, hvac 20 year life span, bath and kitchen remodel 20 year life span. I use 10%. Cash out refi will be 6 months before unless delayed close. Shouldn't have utility expense on sfh. Cash out is usually only 75% ARV or $217k. No property management.
Tim,
Thank you for the feedback! My original numbers are more in line with what you are suggesting. The wholesaler's numbers are what i was using in the above report. How long have you been investing in rental properties? if you don't mind me asking?
@Juan Ospina if you are asking a question you need to look to tag that person. Use the @ sign and start typing their name. double click on it and it will populate the comment box with their name in blue. Then they are notified. I bought my first property in the early 80's. I am not actively investing now. If a deal comes up I will buy.
@Tim Herman I am assuming you invested for retirement purposes or was it to replace your 9-5 at the time? From your first post, it doesn’t sound like you have or currently use a property manager. What’s your experience been with day to management for your rentals? Thank you for your feedback!
@Juan Ospina I did it for retirement purposes. I got out of it when I had my family but I still will buy if it is a good deal. If I was getting started I would be more aggressive. Starting over I would look at house hacking. Takes little capital and you can have 20-40 cash flowing units. i have over 10 paid for units and it gives me a decent retirement income. The majority of mine I have property managers. I have property in 4 different states. I manage two that are close to me.
@Tim Herman that’s what I am working on. I want to be able to quit my job in 5 years. Or at least cut back some. I’m in IT and I am maxed out in how much more I can make. Unless I go Cyber security or full management track. I’m already making six figures so even then my thinking is that investing in real estate, gold and silver is the only real way to achieve financial freedom.
How have you financed your deals? I'm currently working with hard money, business line of credit, private money, and looking at FHA.
You mentioned that you have properties in other states. What markets are you in and why did you choose them? Does that also mean that you virtual brrr?
How did you find local management for your out of state properties?
@Juan Ospina if you are trying to replace your income you are going to have to buy a lot of distressed properties and fix them up. You are going to have to spend time looking for deals. My properties were all where I lived or my kids did. Not all were home runs. Time cures all mistakes. Some I bought owner financed, some I assumed the loan, still legal when I did it and the others I bought conventionally.
@Tim Herman I’m currently working with several wholesalers for deal generation. That’s my goal right now though. Income replacement in five years.
Thank you for all your feedback!