All Forum Posts by: AJ Smith

@Mitch Coluzzi I appreciate the referral, thank you for the invitation into the group and I'm looking forward to meeting other DSM Investors!

Is anyone willing to recommend some great contractors in the Des Moines, IA area? Could be GCs or subs.

I'm looking to purchase my first househack in the Des Moines, IA area next summer after I graduate (June 2021), and I'm reaching out to BP now to start building those relationships and filling up my Rolodex with some contacts.

Des Moines Realtors, Des Moines Contractors, Des Moines Investors -- would love to get your input on this!

Thanks for your time,

AJ Smith

Any househackers/investors in the Des Moines, IA area know of any good downpayment assistance programs?

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I found the following already:

* Bank of America -- America's Home Grant Program -- Up to $7,500 in closing costs assistance

* Iowa Finance Authority -- FirstHome Grant -- $2,500 grant to assist with down payment and closing costs --- Available for First-time Home-Buyers

* Iowa Finance Authority -- Homes For Iowans Grant -- $2,500 grant to assist with down payment and closing costs --- Available for First-time AND Repeat Home-Buyers

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I'm curious if anyone (Des Moines Realtors, Des Moines Investors, Des Moines HouseHackers) knows of any others?

Thanks for your time,

AJ Smith

@Jose Linares, excellent, thank you for clarification on investment property lending rates.

Send those referrals my way, if you would! Looking to buy next summer so looking forward to building those relationships now.

When running your analyses, what interest rates do you use?

For a 20% down investment property, what is the typical interest rate?    (currently using 5%)

For a 5% down Househack, what is the typical interest rate?       (currently using 3.5%)

For a 3.5% down 203k Househack, what is the typical interest rate?      (currently using 4%)

I am analyzing properties in Des Moines, IA market and I want to ensure I'm using the correct range of interest rates for each analysis.

Des Moines Realtors, Des Moines Househackers, Des Moines Investors, thanks for your help!

AJ Smith

@John Warren great thoughts, thank you for your insight.

Taking into account both the lowered rents and the 15% reserves you suggested, it sounds like this property would no longer be viable (ie. negative or very low cash flow).

Any thoughts on finding more accurate rents for future analyses? I'm thinking of using the "Lower 25th Percentile" on Rentometer to make it much more conservative than the average.

Hi all -been analyzing Multifamily Househacks in Chicago and am getting some crazy numbers. Would like to verify on BP and seek critique for any assumptions I'm making.

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ASSUMPTIONS

-5% Down Owner-Occupied Mortgage

-3.5% Interest Rate

-.75% PMI Rate

-$6100 in property tax (from Realtor.com Tax History section)

-$2400 in yearly home insurance

RENTS

-$1822 for a 2br, 1.5 bath (Rentometer - Average Rent)

-$3272 for a 4br,, 1.5 bath (Rentometer - Average Rent)


Chicago Realtors, Chicago Real Estate Investors, Chicago Househackers, Chicago Landlords, Chicago Lenders - looking for your thoughts on my deal analysis here.

What erroneous assumptions am I making?

What parts of my analysis should be tweaked?

What words of advice do you have for someone looking to househack in Chicago for 2021?

Thanks for your time,

AJ

I'd like to take a moment to shout out two fantastic realtors in the Minneapolis/St.Paul area that have been very helpful in my real estate investing journey.

@Adam Tafel and @Jordan Moorehead of the Moorehead team at Keller Williams Realty are two very knowledgeable and helpful realtors.

They have tons of experience working with small multifamily investors, and I would recommend them in heartbeat if you are newbie looking to invest in your first property. These guys are the real deal, they are passionate about helping people invest in multifamily real estate, and they will do what it takes to guide you toward making that first deal.

Just wanted to take some time to shout them out because I really appreciate their efforts.

AJ

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ASSUMPTIONS

Rent is from Rentometer, which estimates $2,020 per 3/1.5 unit in this area.

ARV based on only one comp in the area. The comp was a 3/2 at $445,000, but it had a nicer interior than what I project rehab would make this one.

Looks good to me, meets my $100/door/mth cashflow requirement

Minneapolis/Saint Paul Househackers, what are your thoughts?

Hi @Matthew Maynard,

I used a Price/Sq Ft estimate for my rehab costs.

Based on the pictures, I assumed it would be a heavy rehab, which would include updated kitchens, baths, flooring, paint, [maybe new drywall, maybe new roof].

My model assumes a heavy rehab will cost $35/sqft.

$35 * 1501 sqft = $52,535 rehab