Guys! I need advice. First multifamily deal ever.

3 Replies

@LuisCorona I think this is overpriced to start. Do you have any property management experience in or educated enough to handle that. Vacancy rates are higher in multifamily, so I would run at least 8 to 10% on that. Do you have a bank quote at 4.1% or should that be higher. How old is this property and what does the HOA cover in maintenance and capx expenses. 3% probably won't cut it. Minimum or 5, more like 8 to 10. What is the caprate for this area? You are looking at 5% here. Unless this is 15 years old or less, I don't think that will work. Need more information to critically analyze this.

Originally posted by @James R Dean :

@LuisCorona I think this is overpriced to start. Do you have any property management experience in or educated enough to handle that. Vacancy rates are higher in multifamily, so I would run at least 8 to 10% on that. Do you have a bank quote at 4.1% or should that be higher. How old is this property and what does the HOA cover in maintenance and capx expenses. 3% probably won't cut it. Minimum or 5, more like 8 to 10. What is the caprate for this area? You are looking at 5% here. Unless this is 15 years old or less, I don't think that will work. Need more information to critically analyze this.

This is a brand new property with builder warranty, hence my low repair costs. I do have pre approval for 4.120. 

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Ok so why are you financing 53% and using over 600k in cash rather than 75% and using 350k in the down payment? The COCROI is too low for me at this point of my career, but some do it differently. It seems your appreciation is fairly high in your calculations.