All Forum Posts by: Cameron Carter

@Johnny McKeon Nice project - your renovations looks great. What is the demographic of your new tenants? Do you expect that they will stay long term or have you adjusted the pro forma for higher vacancy rates?

@Don Gilbreath

Here’s some feedback on projected expenses:

Property taxes seem low for 300k property. I would expect them to be more like 1200-1500 annually.

Water seems low but maybe you are just budgeting for landscaping water and the units are each individually metered? On MF I own that have a single meter, the water/sewer/trash runs about 75/month/unit.

Good luck in your underwriting. Hope you can make it work and jump in!

@Matthew Allen

Hi Matt, my law practice includes land use and zoning. Please send me a direct message and I’d be happy to have a chat with you about what’s needed and give you some direction. Thanks Cameron

@Nikki Closser

I’ve bought several deals over the years from investors that did fine when they were local but saw their properties go down hill fast for a variety of reasons (bad managers, lost touch with local market, etc.) after they moved out of state. It’s not easy to manage from across the country.

I would sell the WA property and 1031 into other investment deals in the best market near you that you can actively manage and work to become an expert in. Good luck!

@Joseph Cacciapaglia

I talked about selling a significant portion of my portfolio with my business partner in late 2019 as both rents and values have far outperformed expectations for our smaller, c-class multifamily investments. After some discussion, we decided that we would stay in these properties as it would be difficult to replace the returns without taking on what we perceived to be substantially greater risk.

Even with the covid pandemic I do not regret that decision at all at this point. We have some leverage on certain properties but minimal debt service compared to cash low and we have had consistent rent collections for both April and May. I don’t expect that to change as people are getting back to work here in AZ.

If prices drop some, we will be buyers again, as I don’t see rents falling here in AZ anytime soon.

@Seth Larson

If you think you can find another paying tenant it seems like you would be better off cutting a deal to let her out of the lease. For my units, we maximize profit by minimizing low/no rent periods and out of pocket expenses and then keeping paying tenants as long as possible.

I’ve even committed to partial deposit refunds if the vacating tenant meets all my conditions at move out - no damage, cleaned spotless, etc. in order to have the unit re-rented as quickly as possible.

Good luck

@Ryan Swan thanks!

I own a number of small rental properties in Mesa, Arizona. I’ve found good rates for our duplexes with State Farm insurance, but the best premiums I’ve found for our triplex and fourplex properties are at least 3x more expensive. That is with Farmers through their commercial lines and nobody has been able to explain why they are so much higher.

Anyone in AZ have a good insurance company referral for these types of properties?

Thanks in advance!

@LaVonne Eaton

Hi Lavonne,

I’m an investor and Az real estate attorney. Please shoot me a message and let’s connect. I’d like to learn more about the issue your having and I believe one of the attorneys in my firm can assist you.

Cameron Carter

@Serge S.

You can deal with past due rents as part of the prorations at closing, even if they are more significant than normal, but if you are financing the purchase of your apartments, you need to talk to the lender to see if the underwriting can account for the new possibility of lower collections in the short term. Most larger multifamily loans have strict debt service coverage ratio (DSCR) requirements/covenants based on your actual cash flows. If the lender can't work with you, then you need to consider retrading with your seller to account for the lower short term cash flow.

The buyer on your other deal is probably thinking through these same steps so you need to get ahead of this and address collections right away.