All Forum Posts by: Caitlyn J.

Very exciting! Congratulations! My husband and I are new investors in OKC as well, looking at duplexes & SFR. We are also interested in learning more about rehabbing properties! Best of luck! Maybe we need an OKC newbie investor meet up sometime! BP is an awesome resource.

In case anyone is curious, here's an update on where we are with these duplexes! 

The appraiser did not change their value, still stating $225k for each duplex (current contract price is $248.5k).  The seller is not willing to budge on their price, stating they believe "any commercial appraiser would appraise these for over $250 each".  Also, as we are nearing close and the rehab work is finalized we're finding that what they touted as "high end rehabs" are a little bit more lipstick on a pig type rehab.  Kitchen cabinets do not all close properly, some windows still didn't open well, they didn't hire a foundation crew to install piers, they simply used some cinder blocks & shims (with no receipts), and no main line plumbing was updated.  We are planning to walk and see what they do.  We believe at this point we'd have to put about $6k into these two duplexes after close to truly repair foundation and who knows what other hidden maintenance costs will pop up since their rehab is questionable. 

Since we look to all our fellow BP members as mentors... what do you think of this choice?  Any final thoughts for us before we pull the plug?   It's hard to walk away after 2 months of working toward a deal, but we are not in love with this deal or the numbers.  @Dwyatt Jackson and I are in love with the idea of owning duplexes and know more deals are out there!

Wow!  Thank you @Ron Harris, I am also new to BP in the OKC area and didn't know about all of these meetups and groups!  That's great news, thanks for sharing the resources!  I'm just starting out like you are @Alexander Moses... best of luck in your Real Estate journey!

Hi Bryan! I am not a CPA or a lawyer, so please don't take the following as professional advice, you are right to seek out your own lawyer and CPA. That said, I'm willing to share my opinion with you based on my recent experience. I recently filled out an SS-4 to get an FEIN for my LLC as well. One question it asked "is this application for an LLC" and I marked Yes. If it's an LLC how many members - 2. Next section asks what type of entity it is, under the specific instructions for that section it guided me to mark "partnership". Read the instructions for section 9a to make your own determination based on your situation. I didn't have any issue and received an FEIN for my LLC. Hope this helps, again it's not professional advice, just my experience. Thanks!

Welcome Eli!  I'm also in Edmond and new to BP too!  I'm an investor starting out building a portfolio of multifamily properties!  It's great to "meet" someone else from Edmond! 

Thanks for your feedback @Matt Geerts... I'm including $2000/yr for maintenance, increasing each year, 10% vacancy, land taxes, insurance, water/trash, etc in my expenses... all which result in my stated NOI. The seller is also paying closing costs. Good to know what to think about here, definitely willing to walk if the #'s don't work. Thanks again!

Thank you everyone for your input!  We are absolutely running numbers through our financial model.  Here is what we're working with, let me know if there are other metrics I should share that would help you understand this deal better! 

Contract Price = $497k

4 units (2B/1B) - currently 1 rented for $1175 (all 4 have been fully renovated, construction finishing on other 3, the one rented is a brand new tenant that moved in ~3 weeks ago)

Assuming rent all units for $1175

NOI = $38,370 first year

Financing = 20 yr fixed, 75% LTV, 4.325% rate

Projected Cashflow = $10,373/yr  ($864/mo)

Cash ROI = 8.3%

If the purchase price was lowered to $450 (appraised value) we'd be estimating ~$1000/mo cashflow and 11% ROI. The units have just been fully remodeled, so I'm thinking my maintenance costs should be lower for the first few years. That being said, do you think I'm over estimating my NOI?

Thank you all for your thoughts and comments.  You have definitely built my confidence that I need to draw a hard line here and walk if they won't drop the price to appraisal value.  There are real estate agents involved and they are providing the appraiser with more relevant comps for a possible redetermination of value, however if that fails we will stick to our numbers and walk away.  The appreciation in the market is slow, so I don't want to start with negative equity! 

Hi BP community!  I am new around here and my husband and I are in the due diligence phase of hopefully closing our first deal!  It's two duplexes in a popular area of town that's currently being revitalized.  Currently the area is a mix of older buildings built ~1920's that are being restored/updated.  We are purchasing the duplexes for $248k each.  Renovations are just being completed, first unit is rented for $1175/mo.  Rents range from $700-800 for older non-updated units to $1100-1300 for updated hardwood/granite/stainless appliances type places, all within ~1 mile radius.     

Problem - appraisal just came back for $225k per duplex.  Now we either need to negotiate with the seller, walk away, or come up with the difference in cash to close!  Has anyone faced this issue before?  Any advice?  How common is it for investors to pay more for a property than what the appraisal says? 

Thank you all for your help!  Have a great day!

Hi everyone! I'm having a similar issue, closing on two duplexes next week into my name, even though I have the LLC set up and ready to go. @Jeff B. could you possibly explain the difference between using the Quit Claim Deed to change the vesting vs. changing title of the property into the LLC?  Is this something that could be done at closing?  I'll definitely visit with my attorney about this, but thought you might be able to provide some quick clarity!  Thanks for your help!