All Forum Posts by: Chris Grenzig

@Austin P. if you're looking for 10+ units and up, call a few brokers , get their opinion, then ask if they have any reports on the market they can send you from yardi, axiometrics, costar, etc. and just try and get a feel. Also, cap rates will change submarket to submarket, so to go on Kansas City alone would not be a great indicator either. These reports should break it down by submarket and with past quarterly and annual reports and with their "projections" on a slew of different metrics also.

@Michael J Ralph at the end of the day it's whether you want to manage the property yourself or not, and if the returns meet your goals. If $5k give or take in cash flow is enough money on your investment than I would say do it. If you're going to use 90% of your net worth and your not going to use a manager and you think you're likely to burn out alone, maybe it's not the right move. You got to know yourself and what you want to get out of this. If you want a hands on learning experience, and you're willing to risk this money on an investment, and $5k a year is a great return in your opinion than it sounds great. 

No one can or should tell you what to do here because theres so many internal or external factors. Best of luck!

@Pancham G. it’s in Florida. You know what it cost for material and labor by any chance?

@Ed Matson I hear you, we use them on interiors and are obviously considering it as an option.  Maybe I wasn't clear, but was looking for other alternatives they had heard of and if they had used it, seeing  how it went.

We have a property that has interior hallway access to the units that currently has old, beat up carpets. We're trying to decide on what material to use to replace it.

There's not great air flow to inside which is why we're considering moving away from carpet and something that may hold less moisture, easier to clean, look more modern etc. Anyone who's done something similar what did you use and how did it turn out? Also, any other ideas outside of the typical carpet, carpet tiles, tile, vinyl rollout/plank, etc would be welcome to research more. Thanks.

@Jonathan Farber Definitely paint, but I wouldn't have the tenant do it so that other tenants can't say he made the spots poorly and blah blah blah. Have someone else do it, if you want to do assigned parking you can, but you don't have to. If you get it less than $350 do it, but I have no idea what stuff costs for there. Post an ad on Craigslist or something, it's not that hard to measure out and paint lines, you could even tell you're manager you'll give him $150 to do it if he wants the extra money. 

I think @Jonathan Twombly hit most of the nail on the head. The biggest one I think will be taxes and insurance. Call the county and ask how they assess their new taxes. For example some reassess on sale, some reassess every x amount of years, some states are non-disclosure on sale price so they have a tough time reassessing anything. DO NOT tell them the address of the property you are looking to buy because they will flag it and look for the sale of the property and ding you really quick.

I also agree that the management may put full-time or part-time employees on-site and those will be expenses paid through the property. If you have a manager in mind I would ask them what that cost is.

Also, if you have a management company ask them to do an underwriting for you of what they expect income and expenses would and compare it to your own and ask their reasoning for the numbers they choose.

Vacancy is not considered an expense, it is considered a line item under income and IF you wanted to go by a percent for expenses you go off Net Revenue which is:

Gross Potential Rent

+- Gain/Loss to Lease

-Vacancy

-Bad Debt

-Concessions

-Non-revenue units

+RUBS

+other Income

=Net Revenue

Hope some of that helps.

Chris Wilson 32209 is one of the worst zip codes if not the worst in Jax. Jax is also notoriously spotty even in the same zip let alone a couple of blocks away. I don’t know any manager that will do that small but I would avoid that area all together.

Hoa Nguyen a couple of routes but I’ll keep it brief. First invest with a syndicator in multifamily and ask a ton of questions if they’ll allow it. However you’re investing as much in the sponsor as you are in the deal so be sure to vet both properly. Second, buy a small multifamily and manage yourself close buy. You’ll make a better return than using a property manager and get a hands on learning experience that’ll beat any book. Third, invest in a small multifamily by yourself or with a few people and learn hands on, use a property manager so you don’t have to deal with tenants and other day to day problems.

Troy Iversen we do several a year, if you would like to be notified next time we have a deal come out shoot me a pm and we can talk more about it. Otherwise search through the commercial/multifamily forums and the same names will pop up.