All Forum Posts by: Christopher Yoo

@Tarik Turner Thanks Tarik. Those ballpark numbers are very helpful. As @Upen was referring to I didn’t have the interest correct in my analysis due to lack of knowledge of the higher interest rates for portfolio loans compared with owner occupied primary mortgages. Is that something a lender could do across state lines or would I need to find a local lender?

@Upen Patel. Thank you for the input. Will definitely make that next step in talking to an agent. I think the money will be there either as a portfolio loan or combo of private money and my own savings and HELOC. Would like to have a goal in mind of what is the maximum I would be willing to pay for these properties to even consider buying to make this a “good” deal by the numbers.

Hi all,

Newbie investor here seeking advice on this potential deal and what my homerun offer price should be. I live in CA and am seeking to invest locally or out of state as a buy and hold investor. I have a family friend who is retired and seeking to sell his portfolio of 8 properties (5SFH and 3 condos). I will list 2 of the SFH's and 2 of the condos. The others are similar, all located in the Tampa area. All are currently rented in 1-2 year leases near what I believe to be market value. All in good shape. No major repairs or upgrades needed immediately.

These are a sample of the properties. Offer price is 75% of the realtor appraisal with 25% down, 5% interest on 30 year mortgage and assumes 5% vacancy, 10% property mgmt, 5%repairs

SFH1 3B/2ba 1140 sq ft.

Rent/mo 1500

Prop tax 3384

Insurance 1931

Realtor appraisal $189240

Offer price $141930

COC return 6%

Cash flow ~$185/mo

SFH2 4B/2.5ba 2200 sq ft

Rent/mo 2000

Prop tax 4167

Insurance 906

Realtor appraisal $280000

Offer price $216700

COC return 6%

Cash flow ~$300/mo

Condo1 2B/.5Ba 1750 sq ft

Rent/mo 2625

Prop tax 5335

Insurance 3400

HOA fee 8280

Realtor appraisal $370000

Offer price $277500

COC return -7%

Cash flow $ -435/mo

Condo2 2B/2ba 1320 sq ft

Rent/mo 2300

Prop tax 6363

Insurance 520

HOA fee 7800

Realtor appraisal 450000

Offer price $315000

COC return -9%

Cash flow $ -653/mo

1. I think the condos are essentially non starters and shouldn't even be considered because of the very high HOA fee of 7000-8000 per year. Any other opinions on this?

2. In this case, is approximately 75% of the realtor appraisal value a good target for final purchase? I'm not sure what amount of cash flow, COC return or other measure that I should target in my offer?

3. Any significant precautions or advice for or against this deal as a new investor purchasing a portfolio of 5-8 homes out of state?

4. What options are there for financing a multiproperty transaction like this happen in terms of financing? Would a bank loan on the entire portfolio or would I have to get a separate mortgage for each property? Optimally, I'd like to seek owner financing but I don't know how much equity the current owner has.

Thanks in advance for any advice and opinions offered!

Chris

Thx Ryan. Have been listening to podcasts off and on.  It's been a while since I read some books so I'm going to focus on getting re-educated now. 

Hi there everyone.  I've been interested in investing in real estate over the years but never had the will to make the leap.  Recently married an architect and we'd like to explore more seriously leveraging her skills for a potential real estate business investment.  Ultimately would like to create passive income but think a flip may be the best way for us to get into the market. Open to any insight or advice, especially about investing in the San Francisco Bay area. 

Cheers!

Chris