All Forum Posts by: Jose Enage

Welcome Tam! You came to the right community. We hope to see more of you-- the only way to stay committed to learning, to being motivated and to becoming a better investor.

Cheers!
Jose

I would evaluate a commercial property using the typical NOI and CAP analysis..
Capitalization rate= NOI/purchase price
NOI or net operating income= Effective Income - Expenses = $14,000
Cap rate= $14,000/ $1,450,000 = < 1%
Under any market 1% is extremely low
Depending on what the market cap rate is, ie. 8%, you want your investment to be at the least 1% above the market cap rate.
Find out what the market cap rate is first, you've got a possible deal if it is at least 1% above this figure. This is just the preliminary 5 minute analysis.
If it passes this then you look at other things like price per door, potential to do a value play, etc.
To me, this fails on the initial analysis. I would not go any further.

Makes sense @Mary B.. I will continue seeking a good broker and developing one. They should be an important member of your power team as @Jeff Brown also mentioned in his recent podcast.

Hi Marc,

I got the same info. Did you have a chance to implement the package? I'm just wondering I f its worth spending on.

I just wanted to get a feel for what everyone uses. Do you have your own realtor? Or do you use one of the comp services like www.compthathouse.com or www.investorcompsonline.com?
If you used one of them, which one would you recommend?

For a wholesaler, I need to be able to make multiple quick analysis and thought a service rather than a realtor might be a better option. I learned not to use Zillow or Trulia for final analysis asthma are said to be unreliable.

Your comments please.

@John Rubino Ok thanks for verifying. 20% profit on original investment makes sense

@Scott w. Thanks for sharing your true-to-life experience with Zillow. I will not put too much weight on it for the final analysis; perhaps only for the intial "screening" 5 min. analysis just to see if the deal makes sense-- but beyond that I will do my own comps for final decisions. Perhaps one day Zillow's permutation/calculations will be more accurate.

John Rubino: when you say shoot for 20K, what exactly do you mean? -- offer at 20k

Today, me and my fishing buddies just hauled in 6 to 7 foot sturgeon by the Fraser River in B.C. And after this exhilirating experience I said, "What could ever beat this experience?!" Sturegeons are the most expensive fish in the world on a pound per pound basis. It took us about 3 hours fishing time another hour to bring it in. Then I go to BP and see the quality of responses to my question and know in my heart BP has a wealth of wisdom, experience and support beyond compare. On a thought per thought basis you guys are awesome. As a newbie I still have a lot to learn, research and absorb but with the likes of @Mary B, @Jeremy Holdman, @Jerry Puckett, @Ned Carey, @Steve Babiak, @Jeremy Crutchfield etc. you are not alone. Thank you for sharing your wisdom in this BP community. Thank you !!!!!

I have downloaded JScott's ARV analysis, getting comps from realtors and from now on I will not put a lot of weight in Trulia & Zillow.

Mary B. Thanks for your suggestions Mary. I will put Realtor.com in my list from hereon. Bytwy, I did due diligence on the market Atlanta but perhaps need to fine tune on the specific areas. The reverse wholesale (for cash buyers) and getting bird dogs to assist is a great idea especially for an out of town investor like myself. Any suggestions on recruiting bird dogs?

Hello everyone. I just started my very first direct mail campaign targeting out of state property owners and have been getting calls and responses. There were a lot of curious calls (wanting a property price estimate only) and there are a few motivated. This one seams like a motivated one. I am new at wholesaling and have this out of state owner awaiting an offer for his property. This would be my first offer so you could imagine I am excited but a bit unsure as to what to do. Here is the breakdown:

Property detail: 2/1 (996 sq ft)
Tax assessment (2012): $25,000 *
Zillow estimate approx. $75,200
Trulia estimate approx. $69000
Median home cost in the area (zip code) is $124,900
*The property right beside it with same configuration/size was tax assessed in 2011 at $20k)

Property was built in 1940 and its got a new new 5 yr. old roof and sidings. It is fully paid (no mortgages). Property is beside a Fire Department and zoned as commercial. Are there any implications here I should be aware of?
It is currently renting for $600/mo. (average rent is $760, median rent is $650) He priced it low just to attract renter to just make regular rent payments to his account.
Seller appears to be motivated as he lives 13 hours away out of state. To determine how motivated he was, I asked if he was willing to option the property to me with an option to buy. He does not mind optioning the property to me as long as the current tenant is not bothered because at one time the tenant wanted to buy for 50k. I mentioned that if I paid all cash and closed quickly, what would be the least amount he would take? He said $35,000.

I was thinking of offering $35,000 to lock it in and wholesale for $45,000. What do you think? How reliable is Trulia and Zillow? Is there enough meat for everyone here? Is this a real deal? (it seems to me)

I would appreciate your inputs

Thanks!!