All Forum Posts by: Jose B Mendoza

Thank you @Carmen Dettloff, @Olaseni Akinlade, and @Anthony King for taking the time to respond! I really appreciate it!

First, I would like to reiterate that I have zero experience in real state investment and my knowledge in this industry, which for some could be consider limited, comes from books, this podcast, market research, and some deal analysis I've generated on my free time. I am, however, eager to learn everything about this business and I am so looking forward to finding my first deal, which hopefully will be a good one.

With regards to all of your suggestions/questions/comments, in my analysis I included insurance, 1.5% closing costs, 5% vacancy, 5% repairs, 5% CapEx, etc., and it all adds up to 83% in expenses. Perhaps my estimates in this analysis are too low for this type of property which could cause the potential positive cash flow to drop even more. Do you guys consider this a deal breaker or is the appreciation something to still take into consideration in these type of properties?

The more I look into this deal, the more I see it as too risky for my first investment but it is definitely already teaching me a ton of stuff. I'm starting to think that a house flip may just be a better start for me as I will gain invaluable experience in many areas, and I have past experience dealing with contractors, constructions of all kinds, and even doing the work myself. What are your thoughts on that?

Again, thank you for your suggestions and I look forward to learning more from all of you.

J.M.

     
   

Hello,

I recently found a rental property for sale that seems like a great investment opportunity. However, this would be my first real state investment and I'd really appreciate if you could help me identifying any potential risks. This property is located a few blocks away from an Ivy League school and from the city center. It's a 3 story building; 1st floor is a commercial space, and 2nd and 3rd floor are apartments. Both apartments have been recently renovated and all 3 floors are rented. I emailed the agent and this is the information he provided:

Asking Price: $359,000

Total Rental Income: $3,000

Taxes: $6,828

Down Payment: ~$40,000

There is not much rehab to be done besides basic cosmetic updates on the outside. To me, this property is a great investment because of immediate cash flow and appreciation. Based on a quick analysis, it could generate $500 cash flow. 

Your input will be greatly appreciated.

Thank you!