All Forum Posts by: Arn Cenedella

@Zachary Yelder

Makes sense.

Good luck on sale - hopefully rates dropping will help.

Arn

@Zachary Yelder

I am curious, how did a realtor from Phoenix end up with a huge house in Greenville?

Was it a long distance flip?

I live in Greenville and it’s fabulous. 

This property doesn’t strike me as an ideal rental of any kind.

But perhaps, you could reach out to BMW or Michelin as one of their executives may be brought to Greenville for a year or two assignment.

@Whitney Hutten

I done a couple podcasts with Dan but it’s been awhile.

Happy to be a guest again.

Arn Cenedella

1 Wofford Pine Taylors SC 29687

26 units

June 18, 2024

Lead sponsor Yes.

@Gino Barbaro

New or newer product may not be value add but there are a lot of benefits to owning new or newer product.

Modern floor plans, modern mechanical systems, well insulated, generally separately metered etc. Lower operational costs.

And when one exits say 10 years from now, they are still selling newer product.

@Gino Barbaro

We are buying smaller BTR product direct from builder at completion - typically projects with 10 to 20 duplexes per property. After all, who is the most motivated seller in any market? Typically it’s a (spec) builder. Builders typically are NOT long term buy and hold investors.they build they sell they take their profit and do another new build, rinse and repeat.

There's still a delta between seller ask and buyer expectations on existing property which makes sense. For example, seller may have 4.5% debt and so current NOI is worth more to seller than a new buyer who has to pay 6.5% debt.

Seller finance is a great tool too.

My only caution is to NOT overpay for a property in exchange for seller finance at an attractive rate.

Here is a hypothetical say market cap is 7.0%.

New conventional debt is 6.5%.

But seller will carry at 5%.

With seller finance at 5%: What price does one pay? What cap rate does one buy at?

In my experience, sellers who offer seller finance often want a premium price in return for lower debt.

What is your thinking on this?

Are you willing to pay a premium in return for lower seller finance debt?

If so, how do you calculate the premium?

The same issues can be raised about assumption deals.

@Damon Stefankiewicz

I have 46 years in the REI industry.

Currently I am GP on close to 1000 MF units with a total value of approximately $130M.

I have a MF coaching program that is affordable unlike many that are $20K to $50K a year.

Reach out if you would like to learn more.

Arn

Investwithspark.com

@Cody Flicek

Finding a deal is only the start.

Are you prepared to close a deal when found?

Are you using your own capital or looking for investors?

Do you have your lender lined and ready to go?

Get your ducks lined up so that when a deal is found you can close on it  

Many times…..

Based on nearly 40 years as an active broker…

Investor friendly agent means “agent who will cut their commission rate.”

😀

@Greg Scott

Some (many?) people get great joy talking doom and gloom and Armageddon.

I’ve been in the RE biz since 1978 and been thru several economic and market cycles.

Stagflation in the 70s, 17% home loan rates in the early 1980s, the failure of 1/3 of American Savings and Loans in the early 1990s, the dot com boom the dot com bust, the subprime crisis in 2008, Covid………I’m probably forgetting a few. 😀

So I speak with some actual first hand investing experience.

It’s is never as good as some think and it is never as bad as some think.

While some big name syndicators have crashed and burned, the truth is this only represents a small share of the market.

The overwhelming number of MF properties are owned by long term owners with fixed rate debt and Billions in Equity - those people are not in trouble.

I believe perhaps 10% of the MF stock is owned by syndicators. Let’s say half of those have floating rate debt and are in trouble, that means only 5% of the MF properties are in trouble AT MOST.
So there is some distress but it is limited.

Values may have dropped 20% but for long term owners they don’t care. They know value will over the long haul go up.

@Carlos Ptriawan

The best part of being an investor is that investors get to make decisions where they place their capital AND then benefit or suffer from the consequences of those decisions.

I can say NO ONE has ever become wealthy investing in CDs.

I can say MANY folks have become wealthy investing in real estate.

I can’t predict what the future will hold but the long term trend (unequivocally) is the price of real estate both sale and rent increases over time.

I’ll keep my capital in real estate not CDs.