does this deal makes sense in JAX , florida ?? any feedback ?

Question

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*This link comes directly from our calculators,                  based on information input by the member who posted.

Aaron K. · Answer

@Tchaka Owen 7% in LA is a daydream that would have people lined up out the door.

John Thedford · Answer

Where is the profit? There isn't any.

Michael Walton · Answer

This condo will negative cash flow - as someone posted earlier, you didn't account for:

1) [~10%/$125/mo] Property Management (Based on your profile, you live in Tampa)

2)  [ ??] Insurance

3)  [5-10%] Repairs/Main't.

Also factor in the risk of the HOA fees rising when/if there are foreclosures in the future if the economy sours - like they did all across the country from 2008-2012.

Laura Williams · Answer

@Nelson Miranda I’m not familiar with this area but it doesn’t look like a terrible deal for sure. Condos are low maintenance & easy rentals but you can have issues with boards and assessments & subletting rules. My friend is getting assessed 20k on one right now that he paid 90k for. He’ll be ok cause he bought it about 20-30% below market. But something to remember about HOAs. If I was going to buy a condo I would only buy if there’s equity in the deal otherwise for market prices a house will give you a lot more control and you can rent it out indefinitely. With condos if the threshold of renters to owners gets too high they can shut down people being able to rent and they often do because they loose the ability for new buyers to get loans in the building if too many renters to owners.

Tchaka Owen · Answer

@Nelson Miranda - this response will be based solely on the report you provided. It will be a tad harsh, however it's better you hear it now.

You have to decide whether you're going to be an investor or someone playing around with money, tossing it around and seeing what happens (like playing craps). You have "Flipper/Rehabber" after your name. As long as that remains, please don't ever look at another property with a purchase price that equals ARV unless there's SICK cashflow. We buy below market. Way below. Your objective should be all-in at 65% of ARV. Yes, that's tough and sometimes you have to go to 70%. NEVER 100%.

The report says 7.01% CAP rate....for a SFH in Jacksonville. That CAP may work in Los Angeles or Washington DC, not Jax. You can throw a rock with your eyes closed in Jax and the house you hit will get that.

There are several BP members who are investor-friendly agents in Jax, get in touch with a few, interview them and have them help you find a property. You'll probably be at 9% minimum, maybe even 10 or 11%. Also, factor $2000 for closing costs if you're paying cash. If not, look at $4-5k.

To answer your question: to me, it does not make sense.

Aaron K. · Answer

property management expense?

insurance expense?

maintenance and or repairs expense?

It doesn't tell you anything until you account for these.

does this deal makes sense in JAX , florida ?? any feedback ?

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