All Forum Posts by: Austin Stanton

@Ryan Rupnarain

 Definitely, I feel the same way. Goodluck!

@Ryan Rupnarain

Welcome! you'll find the information here very useful! 

@Thomas Hart

Building a website is fairly easy now due to the changes in technology. I would recommend that you find a good hosting provider, (Godaddy, Hostgator, etc) and spend a day researching how to install a wordpress theme. The advantages of Wordpress is that you can have a fully optimized site that google can clearly send bots through for search results. This will not only add legitimacy to your business, but allow for increased traffic. 

Best of luck.

@Jeff Keys

 Welcome to the site, you can find a plentiful amount of information about commercial real estate. Good luck and see you around!

@Ernad D.

 As Roy said, there will always be another deal. I wouldnt bother getting emotionally tied to an investment whereas those 'few thousand' dollars could impact your cash flow drastically. Stick to the numbers. 

@Bhanu P.

 Thats definitely a good idea. Get an exact breakdown of what the expenses are month by month. Good luck :)

@Bhanu P.

To be honest, based off of the fees, it looks like you may be cutting it close with this one. A $167 cash flowing property is good if its one property, but you're going to be dealing with 4 tenants for the small amount of cash flow, potentially. In addition, Capex will creep up with a property from the 80's, and as the seller states, its already happening. In addition, I would recommend getting an exact breakdown of what this outrageous fee is. Is it things like deferred maintenance which could be a big problem, or landscaping, painting, electricity etc? Knowing these things will help you adjust to the price and see if you can potentially reduce the expense.

Just some food for thought. 

As Steve said, you need much more info rather than just 'how to do a 2M flip'. I would recommend finding the previous CAP rates if you can to see exactly where the price stands with relations to the market its located in. In addition, you would need to estimate the repairs which can be tricky. Do you have a team in place? Appraiser, contractor, loan officer, etc?

All of these will help us determine whether or not the good deal that fell on your lap is actually a good deal, and how to approach it. 

I would recommend finding your bottom line such as desired CAP or COC and go from there. Numbers don't lie and most of the successful investors use preset numbers to determine whether or not they can advance on a property and bid higher. Stick to the numbers. For example, I only invest with CAP rates of 10% or higher, and figuring out the CAP rate beforehand and knowing my bottom line is a necessity.

It doesn't look like you have COC on your spreadsheets, which is important when calculating a bottom line. Just subtract total investment by loan amount then divide the annual cashflow by that amount.

Hope this helps. 

I would agree with @Chi Cheung whereas CAP rate is probably more viable when looking and analyzing apartment buildings. The 2% rule is where the rent is two percent of the purchase price, but when looking at apartment buildings, as Chi said, expenses tend to outweigh and have a major role in analysis.

I would look at the CAP rate in the area to see the norms and then analyze the CAP rate of the projected property. Then, you can go from there and determine whether or not the expenses are normal, abnormal, rents too high or low, etc. So many factors can play a role in the calculations of apartment buildings and whether or not you see it as a good investment or not.

Best of luck.