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All Forum Posts by: Curtis N.

Curtis N. has started 8 posts and replied 133 times.

Hi everyone - I have been looking for my first investment for some time now. I finally found something that looks good (to me) but wanted to get others' thoughts.

It's a 16-unit apartment building located in a pretty good area. It was built in the 70's and was remodeled about 5 years ago. It's not distressed so one of my main concerns is if the numbers they provide in the listing are correct, why are they selling?

I have only seen it online, it's not close to me so I'm just going off their numbers for now. They say it's fully occupied and everything is in move-in ready condition. No fixing up needed.

Purchase price = $644,000
Units = 16
Occupancy = 100%
4 x 2BR @ $580 / month
12 x 1BR @ $490 / month

Monthly rents = $8,200
Yearly rents = $98,400
NOI with 50 % rule with 8.3% vacancy = $49,176
Includes cost of PM @ 12%

20% down with loan at 4.3%
Cap rate = 7.6%
Cash flow = $18,763 ($130 per door per month)

The NOI they have in the listing is slightly higher which makes it an 8.25 cap. I overestimated the expenses to 50%.

CoCr is 11.66% and total ROI is 17.06% based on my calculations.

This seems relatively turnkey and I wasn't sure how good these numbers were for a turnkey investment.

I am ready to put my money into something and I am having a hard time finding something where the numbers make sense. Any help is appreciated!

Post: New Member from Washington DC

Curtis N.Posted
  • Northern, VA
  • Posts 141
  • Votes 29
Originally posted by Jason Cohen:
Wednesday May 22nd sounds perfect for the next Meetup in Columbia Heights.

http://www.meetup.com/DC-MD-VA-Real-Estate-Investing-Meetup-Group/events/113423882/

Thanks Jason. I might not be able to make this one. My first baby is due May 13 and this might be too soon, lol. Maybe the following one.

Post: New Member from Washington DC

Curtis N.Posted
  • Northern, VA
  • Posts 141
  • Votes 29
Originally posted by Ned Carey:
Ok gang I will be going to the BWI meetup in Columbia Maryland tomorrow Wednesday April 10
http://www.meetup.com/BwiMeetup/ I'd love to chat with any of you that want to show up.
Matt Dean Jason Cohen, Chris Drury, Deirdre Brown Travis Lauchman, Atul P., Leonid Sapronov, Randy Coffren, Will K, Cheryl C., Tanya S. Ophelia Nicholson, Sean Stewart, Ezinwanne Hawkins, Curtis N. Benaiah Grimes, Jamaal Hunt, Justin Worster, Raj Tirbany

I hope to see some or all of you there. Ned Carey

I would be in but it's just a tad too far away for me. Looks like a nice big group, though. Thanks for the invite!

Post: New Member from Washington DC

Curtis N.Posted
  • Northern, VA
  • Posts 141
  • Votes 29

Jason Cohen - do we have any plans for the next meetup?

Welcome Raj and Paul.

Post: BP's own J Scott quoted on Fox Business

Curtis N.Posted
  • Northern, VA
  • Posts 141
  • Votes 29

Pretty darn cool! Congrats!

Post: Private Money vs Hard Money

Curtis N.Posted
  • Northern, VA
  • Posts 141
  • Votes 29

You might be able to forget hard money right out the gate because for your situation, it sounds like you probably need the money for longer than 6-9 months - which is the usual case for HM. It's usually used for rehabs where the investor needs quick cash to close on a deal, rehab it, and get it on the market and quickly pay off the loan.

Normal private lending could work for you if you have access to it. The problem that I've seen locally is it's almost as hard to get as a conventional loan unless you already have a reputation built up with a lender.

Most people choose hard money because the lenders don't care as much about you individually, unlike banks. They care about the collateral (your property) and how good of a deal it is. If the numbers work, you can get your cash within a few days. But they will usually only loan up to maybe 75% LTV.

Post: Non compete/non circumvent in wholesale deals

Curtis N.Posted
  • Northern, VA
  • Posts 141
  • Votes 29
Originally posted by Max H.:
So what is stopping a buyer from just waiting to see if the wholesaler doesn't find an end buyer waiting for the contract to expire then contacting the seller them self?

The only reason I can see this happening is because your original contract is not as good of a deal as you think it is. If you didn't find a buyer in time, that's probably why. 9 out of 10 buyers won't care if they have to pay you a cut as long as there's still room in there for them.

But to answer your question, I don't think there is any reason to have a noncompete if you already have a signed contract with the seller ... which you should.

I had looked into several property managers in the DC Metro area, upstate NY, and south-central PA and the average was 8-9% of collected rent. Collected is the key word. If they don't have tenants or if the tenant doesn't pay - you don't pay them.

Post: Best Ways to Invest with $5,000...

Curtis N.Posted
  • Northern, VA
  • Posts 141
  • Votes 29

Liz Brumer - thanks for mentioning the NPN. I didn't know these types of investments were available to the average investor. Would something with such a low value usually be a mobile home or are they just not real estate notes?

Post: Do It Yourself Donts

Curtis N.Posted
  • Northern, VA
  • Posts 141
  • Votes 29

Couple quick ones that I've learned over the last few years, either from my mistakes or someone else's.

When painting interior, use water based paint, not oil-based.

Put down dropcloths when painting. Paint on flooring/carpet is a pain and unnecessary.

If you notice water damage, don't just mask the stain and paint over it. Find the source and fix it right.

Take a few minutes to caulk the exterior where cables or pipes enter the house. Stops the elements and insects.

Drop light fixtures and remove wall plates before painting so you A) don't paint over the fixture or plate and B) make it easier for the next person when they want to replace the fixture. If you have a smaller fixture than what was up there and the previous person didn't drop it to paint, you'll end up having to repaint the ceiling/wall.

Check with the HOA before painting, staining, choosing siding, etc. It can be a real pain for the next person buying the house if you make a mistake.