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I am finding these calculations outrageous...although I am willing to learn if they are simply the truth and my inexperience has led me to believe otherwise. So here is my situation that applies to this:

1st, I would like to say I live in S.California where you cant get a 4 plex for less than a million dollars.

I have the possibility to buy a 4 plex in another state that has good job growth, very low unemployment, no rent control, growing population , low crime rate. A new Costco and shopping mall with major dept stores has just been built within a mile of the location. The 4 plex is in a development of 60 4 plexes that have a swimming pool and clubhouse. It is all brand new construction, so new roofs or major repairs should not be needed for the first 5 - 7 years (hopefully).

The 4 plex would cost me $335,000, it has taken a while to complete construction so the equity has gone up and it is appraised at 365,000.
The rents are $650 a month X 4.
The property management fees are 150 dollars a month ( on site )

I would put 20% down.

Can you apply your formulas to show me whether this is a good deal because the way it came out for me is that I would have to get 7,000 a month in rents to make this a "good deal" according to these formulas.... That seems crazy.

I am new to this but it seems that if I put a down payment on something and renters are basically then paying for at least half of it for me, then that is a good idea. I am perplexed as to why this is a bad investment. There must be something I am missing.

Please inform me!

I currently have no debt, about 300,000 savings, a decent but not excellent credit rating, and this would be the very first real estate investment I make.

Thank you. Lisa :goofy: :superman: :beer: :shock: :lol:

I too am finding these calculations outrageous...although I am willing to learn if they are simply the truth and my inexperience has led me to believe otherwise. So here is my situation that applies to this:

1st, I would like to say I live in S.California where you cant get a 4 plex for less than a million dollars.

I have the possibility to buy a 4 plex in another state that has good job growth, very low unemployment, no rent control, growing population , low crime rate. A new Costco and shopping mall with major dept stores has just been built within a mile of the location. The 4 plex is in a development of 60 4 plexes that have a swimming pool and clubhouse. It is all brand new construction, so new roofs or major repairs should not be needed for the first 5 - 7 years (hopefully).

The 4 plex would cost me $335,000, it has taken a while to complete construction so the equity has gone up and it is appraised at 365,000.
The rents are $650 a month X 4.
The property management fees are 150 dollars a month ( on site )

I would put 20% down.

Can you apply your formulas to show me whether this is a good deal because the way it came out for me is that I would have to get 7,000 a month in rents to make this a "good deal" according to these formulas.... That seems crazy.

I am new to this but it seems that if I put a down payment on something and renters are basically then paying for at least half of it for me, then that is a good idea. I am perplexed as to why this is a bad investment. There must be something I am missing.

Thank you. Lisa

Hi, I was wondering about international investing and wondered how safe it is in Costa Rica for single women?
For instance, I know that I do not feel very safe wandering around by myself in many latin American Countries as both cultural attitudes and laws have not seemed to progress much in those countries.

I am looking into buying a pre construction 4 plex from trada properties...anyone have any experience with them? :goofy:

Thank you guys for this honest advice. Here is the rest of the info in case it matters.
I am getting the property for 335,000 (paying 20% down) but in the time it took to construct it ...2 years...it has appreciated to 365,000. I am paying $150 a month for on site management, grounds keeping etc. The property is in one of the fastest growing cities in the US with good job growth. I live in S.California. I figured that because the building is brand new there wont be much repair work for at least 5 years. I am a longterm type investor and was just planning to keeep the thing for 10- 15 yrs?

I saw somewhere on this site that the rents, even if covering the mortgage, are taxed at some really high rate (45%)...and as income. Which seems silly because I am not in the 45% taz bracket. But then I read that even though your property is going up in equity, you can claim "depreciation" of the building each year and lower your taxes.

The last thing I am confused about is that, seeing as I live in S.Calif....you cannot get a 4 plex here for less than a million dollars. I have found a brand new one in an area that has no rent control, low unemployment, high job growth, good renters market, low crime, for $335,000 with reputable onsite management....So my question is : If this deal sucks how is it possible to get something better.....

Or is it really that you are saying that as compared with a decent stock performance...this is bad.

Thank you both for weighing in! Lisa

:shock: :goofy: :pup: :crying: 8)

I am considering buying a 4 plex from trada...they build it new and when its ready for occupancy you start your mortgage... :pup: :shock: :D :goofy:

thank you for that very simple layout....very helpful. But you left out aprecoation or rather equity...I imagine that over the next 5 to 7 years the property will go up at least 100,000?

Hi, I have come upon a 4 plex for $ 335,000 that is new and though not luxurious in any way, does have a pool and clubhouse. It is in a somewhat lower rent area and the entire complex of more than 60 4 plexes seems to be for mostly lower income families. There is not much crime and apparently jobs are growing. They say that the rents will be 695$ a month for each apt which I am not sure about..for this area these rents are about 100 too high...but they say that the area is changing...but maybe they can only get 600$.....the area used to be a bit more degraded but they just got a new shopping center and all sorts of stuff like that so it seems to be going up...
I have never bought anything before and would also like a house...I have a total of about 300,000 cash. I have no debt and a decent but not great credit rating.
My income is quite small as I am an artist.

Any ideas...Thanks! :pup: :shock: :lol: :goofy: