All Forum Posts by: Bryan Hartlen

Hi Kyle. Is this for investors looking to put money into syndications or investors looking to invest in MF outside of a syndication?

Hello BP community. I've seen a few posts on Roofstock but haven't seen my specific questions listed or answered. Hoping you can help out. I'm interested in the viability of Roofstock as another potential exit for tenant in-place investment properties. For those of you that have sold a SFR property through Roofstock:

- Did you price your property using a cap-rate? or market comps?

- How was the experience compared to selling through a local realtor?  Besides the benefit of selling with tenant in place any other benefits that might not be immediately apparent?  Any issues that someone new to the service should be aware of?

- Are your DOM faster or slower than through your local realtor?

- Net proceeds better, same or worse?

Thanks for the insight!

@Derrick U. make sure you know where in Phx it is located.  There are still markets in Phx where you want to stay out of. A couple questions:

- sounds like it’s being marketed as a turn key unit.  Good locations in Phx are selling at $130 - 150k a door for turn key class C properties (Cap rate in these areas run in the 5 - 5.5% range).  At $80k a door, you’ll want to look very carefully at the location. 

- only 4 parking spots to 12 units?  You’ll need to discount your rent significantly for units without parking or on-street parking.  Phx public transit isn’t that great - most people want/need a car.  Make sure your rent numbers factor this in.

- For well managed properties we model 45 - 55% expenses and then verify through seller's T12.

- Is your cash flow analysis after debt service?

@Derrick U. you’ve got the right idea but as @Greg Dickerson and @christoper hunter mentioned there’s some fundamentals that you’re going to need to establish that will bring legitimacy and value to a deal. Every real estate deal needs 3 things:  Money, expertise and effort.  You need to be able to contribute in at least one of the areas.  Focus yourself on getting education and networking relationships to build value in these areas. 

The Phoenix MF market is very hot right now at all levels.  The entry level (< 20 units, < $3M) for C class value-add properties are running at 5 - 5.5% cap rate and are often swallowed up quickly by California 1031 money. So you need to be ready to pull the trigger on an offer very quickly and close almost as fast (due diligence and funding).  

Good Luck!

Ok. This was from a seller's perspective.  Thanks for the insight.

Thanks @Greg Dickerson. Why wouldn't broker commissions on the sell side be negotiable?

From a modelling perspective what are the typical seller costs (fixed or % of sale price) that you model for closing costs on small, 10 - 20 door properties?

- Broker’s commission(s), Title, Recording, others?

Which of these can be negotiated?

Unless you believe there's an opportunity to differentiate yourself from the rest of the market or protect from possible significant cost increases (doesn't sound likely with fixed costs) - stick with the norm for the market.  Raise rents.  

- Fixed return vs Joint Venture

- Plan A & Plan B exits

- Developer / Active partners projected profit (my headroom on a fixed return investment)

Drive-bys / walkthroughs on different days and different times.  Some neighborhoods have completely different personalities at night vs day.