Investor · Denver, CO · Member since 2016 · 181 posts · 242 votes
Just closed on my first SFH 2 weeks ago and I am AMPED to have finally defeated paralysis analysis and joined the club. Quitclaim deed has been initiated and the property is officially in the LLC's name. Let the fun begin! Here are the dirty details:
Purchase price: $112,502
25% down
3.375% int rate (paid ~ $1,500 in points)
3 bed 2 full bath with 4th
non-conforming bed in the basement
Detached garage and carport
Property taxes $1,127
Insurance $1,050
Property management 5%
Rent $1,250
Vacancy rate 5%
Maintenance and repairs 6%
Oh **** fund 5%
Cash flow $421/month
My main issue going forward (like many fellow investors) is having enough capital to purchase more properties. I am able to find great (> 1% on the 1% rule) properties but I don't want to wait 6 months to save up enough cash. Time to get the BP book on no and low money down and also find some partners!
Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes
6y
@Nicholas Sheridan, Jr. in light of your post, we are going to officially relabel the “capex reserve” in our calculators the “oh sh** fund”. This is far more intuitive.
Congratulations on what seems like a great first step!
Investor · Atlanta · Member since 2016 · 57 posts · 54 votes
6y
Congrats @Nicholas Sheridan, Jr. It's a great feeling getting that first one completed. Like you I'm working on keeping the momentum going. Networking and more networking is what I'm doing presently.
Was the property previously owner occupied? Reason I ask: will taxes go up without homestead/owner occupant deduction? Different locations do it differently, but that's how it works in my area.
Huge congrats! How are you able to make $421 cashflow if the rent is $1200 with all the monthly expenses you listed?
Hey Patrick! I think that's his cash flow before making his mortgage payment? Our market is pretty similar to KC and ~$400-$500 is typical pre mortgage payment.
Investor · Denver, CO · Member since 2016 · 181 posts · 242 votes
6y
@Justin Thorpe I could care less about appreciation. If I wanted to gamble I would take my money to the stock market. If the numbers work up front then they will always work.
I wanted to put a number and felt 2 weeks was a sufficient time period for a tenant to move out and repairs to be done. PMs job is to have a new tenant selected before old tenant moves out
Good to hear man! I’m just beginning the process of trying to understand my local market better to see if there is any possibility of finding deals here or if I need to look elsewhere. The hardest part for me is getting overwhelmed with how much I need to and where to start. Any advice on how to start out?
I’ve been reading plenty of books and listening to podcasts but having a hard time of where do I go from there? I don’t have enough cash yet so in the mean time I’m reading more and then trying to understand the market and build a team. Plus I don’t want to really buy anything until the virus issue calms down. But I want to try to have my team members in place so that when a property becomes available i am ready to go.