All Forum Posts by: Jim Hiler

@Jonathan Polanski... Interesting story. Maybe the seller was interested in making some money from the interest.

Do you mind me asking where you found a quadplex for $250,000 in South Florida?

Was it in a war zone or  in need of a complete rehab?

@Hadar Orkibi... Thanks for your comments. I would agree that I need to do more homework and some of my expenses could be low. I will double check a re run the numbers.

My real question was how can I make this work by using hard money for the initial acquisition and then re-financing to a more conventional commercial loan...When I run the numbers it runs at negative cash flow until the refinance. Is there something I'm missing?

Answering my own question this just may not be a great deal.

I have a financing question about regarding a 5 unit property in South Florida that I'm analyzing. The property consists of 4 structures - 2 duplexes, an SFR and 2 car garage, and has 3/4 of acre.

Here is the link to my analysis using the BP calc assuming a $455,000 purchase price and below is quick summary.

https://www.biggerpockets.com/calculators/shared/260799/874435c9-b77f-4f96-a3de-90be11c4cbba

The asking price is $475,000, Assumed purchase $455,000.

I've assumed $30,000 in repairs as a place holder (TBD)

Current Rents total - $4,700 + an additional $75 in income from laundry machines _ According to listing broker.

Taxes are $5,868 (verified)

Insurance $4,500

When factoring in other expenses - landscape maintenance, water, elec, vacancy, repairs, cap ex and PM I end up with $610 in cash flow. Not great but not bad. My purchase cap rate comes out at 7.4% and COC return 4.85. These numbers are not great but for this area I think they're decent.

Also I know that I bump rents in at least 2 of the units, and rent out the garages separate, and maybe even rent out some of the land for boat storage etc.

Also the icing on the cake is my long term strategy, which would be to tear down the existing SFH and garage and build at least 4 more 2/1 units. Now I have an 8 unit property.

That being said the owner will only accept cash or hard money. When I factor in using hard money to buy this and assume it will take 6 mons to refinance it minimum the deal doesn't look good.

I'm looking for ideas, suggestions, mistakes that I made, things I missed in my calcs? Any help is much appreciated. How can I take down this deal?

South Florida / Palm Beach County  Multifamily Investors - What are you buying?, Where are you buying? What kind of returns are you getting? What are you seeing in the market? Or are you buying out of state or sitting on the sidelines until things cool off?

I have about $100,000 to invest and I've been searching for a small to mid sized value add multifamily investment (4 - 10 units) but it seems like the deals are very hard to come by. There's a few properties for sale in the Lake Worth Area that have OK returns but I'm hesitant to invest there...

Has anyone landed a deal locally lately?

@Forrest Holt  Keep me updated....

@Forrest Holt Your timing is good. If you listen the latest podcast https://www.biggerpockets.com/renewsblog/biggerpoc... the guest @andrew propst talks about building 4plex's.

I am now doing some research to see if I can get the numbers to make sense in my area.

Interesting article which sheds some light on where the Miami / South Florida condo market is going... I wonder how this will affect SFR's and small multifamilies?

Any opinions out there?

https://therealdeal.com/miami/issues_articles/top-...

Thanks @Nancy Bachety... The occupancy is my biggest concern because my assumption of  the amount of nights it will be occupied drives the numbers. To me it seems like the occupancy is a big guess. From the quick research that I've done other similar houses in this area are not even booked up for this summer. The demand doesn't seem to be there.. Meanwhile I know that other vacation rentals on LI (Fire Island or the Hamptons for example) are booked 3-6 months in advance.

As for the financing yes this is far from from primary and if the bank considers it a second home and does not take into account the rental income I'm not sure I would be approved. My question is will take vacation rental income into account? Or can I call it a long term rental? If so what type of documentation do I need to provide for them to take the rental income into account?

Thanks for the tip on AIRDNA I'm doing further research there as we speak....

P.S. of course the north shore overlooks the LI sound but that's the still the ocean! 

I'm considering buying a vacation rental on the north shore of LI,NY. It's a decent size house 4 bed/2.5 bath with a finished basement that could potential be a totally separate space to rent out. It's also on an Acre of land which gets me thinking I could split the property and build another spec house or another rental at some point. The property overlooks the ocean and has private beach access. The area is popular doesn't have the draw that the nearby Hamptons have.

I'm just concerned with the amount of days I'll be able to rent it considering it's a large property, and I would have to pay around $330,000 - $350,000 and guessing that it would have to rent out for about $500 per night. I'm thinking that will limit the number of renters and keep my occupancy low... versus a small 2/2 property that rents for $250/night or less....

I'm also trying to figure out how to put together the financing. I'm planning on selling another property that's a duplex/mother daughter that was a bad investment / provides $0 cash flow but has enough equity to provide at least part of my down payment. I'm wondering how the bank would consider the property? A second home?  In which case I assume my debt to to income ratio would have to work.  Or can it be considered a rental property and will the rents count as income?

Any tips are much appreciated. 

Thanks

@Brian Garrett What type of projects are you working on? I'm a high end builder/GC but also an aspiring investor/developer. I'm would not be interested in working as a GC on smaller low-end flip projects unless maybe there was an opportunity to be a partner in the deal. 

If this is something that would interest you we should discuss things further.