All Forum Posts by: Andrew B.
Andrew B. has started 3 posts and replied 13 times.
Post: Pinnacle Investment Properties
- Redondo Beach, CA
- Posts 13
- Votes 2
Originally posted by @Mike McKinzie:
Originally posted by @Matt K.:
KC is a pretty easy market to research online... due diligence isn't that hard with how well documented KC is.
Yes Matt, you can get a lot of KC stuff online. My 'due diligence' is just about checking out a 'single house.' I love the neighborhood I bought my homes in, it was just the bad condition of the houses. Just this year, one of the houses had a collapsing septic tank which I had to have removed as the backyard was getting a sinkhole making it a danger to the kids playing. Another $2,500 in repairs, if you include the resodding. No where online did it say this property had an old septic tank, from a previous home on the property. I am not sure why this thread has diverted from the OP's question. They just wanted to know anyone's experience with Pinnacle. If you had an experience with them, then post it for everyone to read. If not, then why are you even posting here?
Mike - Was your experience with KC Metro Homes LLC after Pinnacle referred you?
Post: Criteria for Little Rock Arkansas
- Redondo Beach, CA
- Posts 13
- Votes 2
Post: What's driving growth in Cleveland?
- Redondo Beach, CA
- Posts 13
- Votes 2
@Michael Swan How have your experiences been investing in Euclid? I've been looking at 2 SFR turnkeys off Williams and Ball St. Seems a lot of SFRs just have 1 bath, odd quirk of these old builds. You've might have heard an Amazon center will be in Euclid 2019.
Do you know if Willowick and Bedford nearby are good cities as well?
Post: Turnkey Real Estate Investments
- Redondo Beach, CA
- Posts 13
- Votes 2
@Jessie Nunley May I ask if you don't mind sharing what your CoC returns and monthly cash flow have been like with Memphis Invest so far? What city are your properties with them in?
I was shown about a handful of their holdings in the Houston, Memphis, and Little Rock markets, but the cash flow and CoC returns were less than $100 per month and 2-4% after factoring in additional expenses like 7% vacancy and 10% maintenance per month to go along with 20% down and conventional mortgage. Just seems to reflect the reality of generally tight market conditions across most of the U.S. currently, tough to find higher returns.
Post: Has Anyone Tried Areavibes.com Crime Maps - Are They Accurate?
- Redondo Beach, CA
- Posts 13
- Votes 2
Has anyone used this site in addition to the data from Trulia and City-data? Just would like to hear your thoughts!
Post: Any opinions on Neighborhood Scout ?
- Redondo Beach, CA
- Posts 13
- Votes 2
@Leslie Frieze Have you tried AreaVibes.com for crime maps? I came across that one recently.
Post: Deal Analysis - Kansas City Class C property
- Redondo Beach, CA
- Posts 13
- Votes 2
@Larry Fried @Jay Hinrichs Thanks to both of you for clarifying on how to factor in these expenses!
Post: Buying my first turnkey property sometime in the next two months
- Redondo Beach, CA
- Posts 13
- Votes 2
Originally posted by @Barclay Chan:
@Ali Boone since this post I've bought one turnkey property and a new construction in Jacksonville FL using 20% down. Both returning me a little over 17% cash on cash (did not include closing cost, vacancy and repairs into calculations). You have a lot of experience with turnkey, what states are you invested in? I am looking for my next deal and was wondering if you have any recommendation as to where and with who to invest?
I like turnkey but I feel like if I had the time to fly out and buy the house myself I can get it for much cheaper but then I will need to look for a team to rehab and manage it afterwards. Do you know of a team that helps buy distress property, rehab (and I get all the tax benefits) and manage it for me afterwards. If you know of any please send me their contact.
What was the CoC return after factoring vacancy and repairs? Seems more helpful to use this return in reality. It was a deal breaker for my one of the turnkeys I was recently offered, because the company I was working with left out those figures, which made the monthly cash flows too optimistic.
Post: Deal Analysis - Kansas City Class C property
- Redondo Beach, CA
- Posts 13
- Votes 2
Originally posted by @Jay Hinrichs:
I am seeing more and more of these spread sheets and none of them have leasing fee's therefore the vacancy factor is under funded.
unless you have a deal with your management company to lease the units for free. your going to have turn over.. everyone does .. and its not common to have a tenant leave and not have a month of vacancy plus a lease fee.. and of course turn over costs.. although I was happy to see your contingency line most folks don't put that in there..
I would also not run performa's on increasing rent every year that will all but gurantee vacancies.
How is first month's rent placement fee accurately factored into calculating CoC return?
Example: Turnkey Property Mgmt company charges first month’s rent for tenant placement fee with new lease. So does monthly rental income become x 11 months instead of 12 months if I understand correctly?
Post: Checking my math on 1st deal for turnkey near Little Rock, AR
- Redondo Beach, CA
- Posts 13
- Votes 2
Hi all,
I am trying to make sure my calculations with my due diligence are accurate upon selecting my first deal for a SFR rental that would be a newly renovated turnkey managed by a PM. I recently fed my numbers through the BP Rental Property Calculator, being one of the first few times I've familiarized myself with it. My goal is monthly cash-flow, and from what I've been reading, I should realistically pursue a minimum ~8-12% cash-on-cash return with a 20% down purchase.
Are the numbers below feasible and is my Cash-on-Cash Return calculation below accurate? I think this was a good exercise to try on the BP Calculator either way.
PROPERTY INFO
4 BR, 2.5 BA near Little Rock, AR
$31,980 cash purchase (20% down, 30-year fixed)
Property valued at $159.9K
INCOME:
- Rent: $1,295/mo (Year 1), with $50 monthly increase in Year 2
EXPENSES (Total $1,230.61):
- P & I (30-year fixed at 4.75%) $667.29/mo
- Property Management (10%): $129.50/mo
- Property Taxes: $163.67/mo
- Homeowners Insurance: $50.40/mo
- Repairs/CapEx (10%): $129.50
- Vacancy (7%) = $90.65
RETURNS:
- CoC = 2.42% @ $64.39/mo
QUESTIONS:
1. Should I include closing costs as part of cash needed (putting 20% down of purchase price) when calculating Cash-on-Cash Return?
2. Since the property management company charges first month’s rent placement fee for a new tenant, how should I factor this in with my Cash-on-Cash return - do I also lump it into cash needed?
3. Am I missing any critical expenses to add above?
It sounds I should pass on this property if my math is correct? Given a ~2% CoC return is not enticing or sustainable given my goal is monthly cashflow. Or are my estimates too conservative?
Thanks for any input!