All Forum Posts by: Andy Chu

The question is that are you trying to flip or are you trying to buy and hold. The evaluation for the deal is completely different between the two strategies. 

FLIP 

Sales Price 75,000

Realtor Fees (4,500  + 500 ) for transaction fee 
Transfer Fees and Etc (1,500) Assumption I don't know PA customary fees 

Acquisition Cost 50,000
Acquisition Closing cost (1,000) Once Again not sure about customary PA Fees 

ASSUMED PROFIT  - 17,500 (Without Financing / hard money cost )

Rental 

Take into consideration at least the following 
Vacancy 

Annual Insurance 

Capital Expenditures 

Taxes 

Any utilities not covered typically by tenant (Trash, sewer, well, etc) 

Take total revenue 

-subtract all other fees 

 EQUALS cash on cash return 

cash on cash return divide by acquisition cost (51,000) and that's your Capitalization Rate 

I would not refinance but get a HELOC. A HELOC is a home equity line of credit. The difference between this and a cash out refinanced Conventional loan is that let's say you get a line for 60K. It is like a credit card, you do not need to pay interest until you decide t utilize the funds. Keep in mind though, that the line incurs interest at market rates and is NOT fixed.

TRID is required on not only Owner Occupant files but also second homes and Investment properties. 

As an owner of a property management company. We always highly encourage owners to purchase a home warranty. It's minimizes the crazy A/C and heater repair costs for owners. 

Do a cost analysis of how much the renovation will cost and how long will they last? Also, do an analysis the cost to purchase a new place. Once you get an return on investment (ROI) from both numbers, then you can make a more informed decision. Best of luck

hi robin, 

Being in soho lofts has a lot of perks, however, that community has one of the higher hoas coming in at 0.40 per as ft per month. Keep in mind as the owner, you are not benefitting from the concierges, valet, gym, pool, and etc. The owner however pays for all the amenities by means of HOAs. 

If you were to sell, could you purchase something around 340,000 (taking out all closing fees and take out a loan for 80k) , or paying cash for about 220,000 (closing fees - loans) , could you yield a higher cash flow than $700 in a low maintenance environment ? I would say definitely it is doable , but you would need to venture into the single family space where the hoas are $100 a month or less.  

I really like a site called. city-data.com, type in the zip code and it will give you every demographic you are interested in. 

no I'm not even stuck on Detroit at all. It's worth the flight there. I'm looking at mobile, al , New Orleans , Lo, Mississippi , and other Places

Vegas market is no longer a cash flow market unless you get excited about a 4-5% cap rate.