All Forum Posts by: Jon R.

This is not an issue in this case.  Current tenants (students) bike to and from class regularly.  In speaking with them, they stated the location is great and have other students ready to rent.  The units have not been placed on the market because the owners were in the process of renovating them at the same time they were also moving out of the area.  They are leaving the rent listing up to the next owner.  A realtor I am working with strongly believes they will rent easily.  Area rent price analysis shows they were previously rented below market.  One concern is that unit #3 is actually a 5 bed 4 bath home that previously rented for $1200.  Concern is getting 1 student to rent that at a min of 1200.  However, opportunity could be to list for min 1200 or 400 per room.  Either way, I still need a creative financing strategy to obtain it.

Roy and all,

Thanks for the great reply.  To answer a few questions posed, here you go:  Currently parking at the university is inadequate and the city has consistently voted down building parking garages in the area.  The one unit currently rented is rented by a student who rides a bike to and from class.  In speaking with him, this is fairly common and is well within riding distance of the school.  The other 3 units can be rented at this time however in looking them over, flooring is in need of replacement.  That is about the only repairs needed.  I estimated a mortgage payment (for calculation sake) at a 4.5% rate at 30 yrs.  On this particular place the monthly payment would be around $1850 per month including taxes and a 15% holdback for maintenance.  (this is of course assuming 20% down which I don't have).  The unit currently rented brings $750 per month.  Historically, the other unit rents for $650 per month and the third (larger) rents for $1200 per month for a total potential of $2600 per month.  Further, my thought was, for example, on the larger unit listing for a min of $1200 per month or $400 per room.  This places it in the $1600 per month total potential bringing the total potential up to $3000 per month on an $1850 mortgage.  These are multiple bedroom and multiple bathroom units making them attractive to college students.

Hard money?  That's a new term to me. 

I'd like to pick the brains of everyone on what you'd do in this scenario:

Multi-unit property is up for sale.  Motivated sellers who are no longer in the area, which makes them even more motivated to sell.  Property on the market for over 90 days now and price just reduced to 15% below tax valuation.  4 units total with property, 1 unit rented out.  Other 3 are not rented because they were being renovated just prior to listing and seller was in the process of moving, therefore seller has not posted them.  All units are within 1 mile of a major university and business district.  University housing is short therefore renting is generally successful in the area, especially for units within walking distance of campus (which this is).  Total opportunity if all units were rented, after mortgage and a 15% holdback for maintenance expenses, would be just over $1000 per month profit, or 40% positive.  The problem is, the total asking price, even after the reduction, places the normal 20-25% down out of our range.  I'd like to hear some creative strategies people have used or would use in this type of a scenario.  And simply gritting the teeth and walking away is on the table as well.  Thoughts?

Hello to everyone.  New motivated member here.