All Forum Posts by: Dan Miles

@Jonathan R McLaughlin  So since the capes is higher, maybe it's something someone else could do that had more capital on hand.

@Account Closed How much reserves would you normally have?  

@Sunny Shakhawala No. the taxes and insurance are not included in the 25k. Yeah. I was going to come in lower on the price. It does feel thin. I don't have any experience with multi family. So you think think the expenses should be higher than what I use for my SFR's?

@David Zheng Small town.  I live in a small town also.  I rent my SF units for 600-800.

@Steve Jellen Right, Steve.  The only reason I'm looking at this is because it is being sold below value I believe.  The duplexes in my area are selling at 200k.  I have seen  an 8 unit at 1M.  So, I saw this and it caught my eye.

I will look at it more.  I know improvements might be slow though because 123k deposit would seriously kick my butt.  THANKS!!

Hi fellow BPers!

I'm interested in a multi-family property and need fresh eyes looking at it to decide if it is a good deal or not.  My only concern is cashflow is low at this point.  It's a 20 unit complex. With a 1200sqft. house on the property as well.  5 separate buildings of 4 units a piece.  12 2bd units (700sqft) and 8 1bd units (600sqft.).   Figuring 30% GI for expenses

List Price: $619,000

2016 Gross income: $84k

Expenses:  $25,200/yr

Insurance: $2350/yr

Tax: $8,000/yr

Debt service: $40042.56/yr

---------------------------------

Profit: $8407.44/yr.

This is a commercial loan with 20% down ($123,800) at 5.25% for 20yrs.

So $8407/yr.  doesn't sound like much for a 20 unit.  Vacancy is at 16%.  So there might be room there.  The management company says that the owners have not raised rents for a long time, but discourage doing it quickly as to nut run people out.  Looks like owner pays water also but I'm not positive.  There is room to grow seeming as there is no central a/c or heat.  They have window units and baseboard heat.  

So tell me what you think!!

Thanks!!

Dan Miles

Yeah.  I'm starting to think that it isn't the best investment now.  I just don't want it to hurt my purchasing power.

should I still do a cash out refi if my cashflow drops down? I have a condo. Usually not a good investment but it used to be my primary that I turned rental 2yrs ago. Right now mortgage is at 4.5% total with taxes and ins. $519/mo, $200/mo HOA. Right now rent is at $900/mo but will go up to $975 in Oct. The refi gives me $18k. New mortgage payment of $975/mo @ 4.62%. With new floors and counter tops it could rent for $1100/mo. I owe 74k on the loan and after refi would be a 93k balance. I also thought about selling it, but it helped me get my next loan since I've had it for 2yrs. So, do I take the cash and refi lowering my cashflow or just get rent up there and save for my next rental?

Dan

@Seth Levey - Yep.  It usually takes a couple grand to refi though, right?  First time doing a cashout refi.