All Forum Posts by: Adam Craig

Chuck -

I am a rookie still working on my first deal, so I dont know what my true numbers are going to be. I only include them because I want to be conservative on my numbers and include everything possible. But your right - I dont imagine myself spending on these with Craigslist and yard signs.

I have a PM field, I just plug in 10% when I want to know. What are turnover costs, that's not included in my 8% vacancy rate?

I like having rates in each field so I don't have to manually do it.

Do you have any percentages or average annuals for

Lawn Care
Utilities when Vacant
Capital Costs

I took the SFH excel template from the resources section and I am revising it. Can you please check my costs based on 100K SFH and am I missing any?

Vacancy Rate - 8%
Insurance - $750 / year
Maintenance & Repairs - 10% of gross rents
Advertising - $150 / year
Admin - $150 / year
Closing Costs - 3% of purchase price

I didnt forget property taxes - its so variable I left it out.

I am trying to convince them that buying a single family home for 85K that nets me 150 a month is a better buy then a 65K duplex that gets me 800/month - its a tough argument but makes more sense for my long term goals.

My market is the Cleveland suburbs. I decided long ago that I want single family homes in B & C class neighborhoods that are sustaining or growing in population.

I come across a lot of investors at my meetings that are encouraging me to invest in Cleveland multifamily homes because the cash flow is so amazing.

As mentioned in previous posts - I have a business that provides me with 6 figures + right and growing - so cash flow is not a problem. I feel like I am approaching real estate different from an investor who relies solely on rental cash flow.

I am okay giving up some cash flow because I am more interested in mortgage pay-down/tax benefits/appreciation.

Am I mentally approaching this wrong? Should cash flow be my main concern? I am afraid of buying a 40K house in Cleveland Heights that is going to be worth 45K in 10 years.

Should my current income change my approach? Would it change yours?

Thanks John - I just sent those steps to my loan officer so hopefully he will see this as a solution too.

I am starting out buying SFH's buy and hold rentals under 100K in Cleveland suburbs. I have Good credit/20% down/W2 income so I will be using bank financing.

Instead of buying "ready to go" homes - I want to buy slightly distressed properties and cosmetically rehab them. I know that's where a lot of deals are and I really want to learn about rehabbing (not swinging the hammer but knowing what goes into it and how to manage it).

How are conventional borrowers financing repairs on buy and holds? Are 203ks common? Short term loans? Cash? I would love to wrap it up in the loan but not sure if that is being done.

Thanks for your thoughts.

Click the resources tab at the top of the page, then click filePlace. There are bunch of templates in there, and a goof SFH excel model.

My previous landlord had codes for the keys on his properties. That way he didnt have to be there when I came to see it.

This seems like an idea that I will defiantly go with so I don't have to be there for showings. Your thoughts on this?

I am not a flipper. I am not looking for massive cash flow. I want to buy SFH homes in B and C class neighborhoods in the cities that have the best chance for appreciation.

I live in an Eastern suburb of Cleveland. Cleveland sucks, the inner east side is the ghetto, and the outer eastern suburbs are flat at best.

All the growth is On the West and South/West side of Cleveland.

Its only about 45-60min drive to some of the growing areas. Is this a reasonable market to try and get into? Or would I be better off investing in my own county so that I am close to my properties. Am I over-thinking inflation?

Below shows the growth map

http://www.cleveland.com/datacentral/index.ssf/2010/06/find_2009_population_estimates.html