All Forum Posts by: Kris Kaufman

Hello BP community! Wanted to post this deal on here to see everyone's thoughts and if they would proceed.

The building consists of 13,000 square feet. It has a large commercial restarant space, 9 apartments (1-2 BD), and 20 rooms rented on a weekly basis. The rooming house shares bathrooms and doesn't have any kitchens (no open flames permitted). It has 20 offstreet parking spaces and is located on the center square of a small town and decent neighborhood. The purchase price is $1,075,000 with the seller carrying a 2nd of 386K (4% on a 30yr) and a bank financed 1st of 689K (4.5% on a 25yr). Both are fixed for seven years. Outstanding terms!

Rents and expenses are as follows yearly:

Income at full capacity = $218,280 

         Vacancy (10%) = $21,828

         Effective Gross = $196,452

Expenses:

Taxes = $11,924

Insurance = $6,180

Electric = $6,100

Trash = $900

Gas = $3,736

Management = $15,716

Mantenance = $9,000

Water/Sewer = $6,370

Municipal Fees = $1,125

Advertising = $609

Rental Fees = $2,500

Cable = $1,815

Extermination = $1,100

       Total = $67,075

Income = $129,377

        Total debt payments = $68,052

Net Income = $61,325

Keep in mind, rents are low for the property and should be raised by an estimated 14k/yr. This would push NOI to $75,325. I feel the management fee is probably to low on this building, considering it's partially a rooming house, but the amount of cash flow would give lee way for higher managment fees. Please give me your thoughts and thank you for your insights.

-Kris

Bill G. Thanks for the input Bill! It's a broad subject, but you gave me food for thought. Been reading many posts on here dealing with lease options and I quickly realized two things: 1.) I agree wholeheartedly with your stance on predatory real estate practices and 2.) You pop up in almost every discussion on BP! I can only hope to attain that blissful retired state someday, sipping my coffee, helping RE newbies find their way :) Looking forward to reading your other posts.

@Bill Gulley 

@Bill G. Sorry, it was a very vague question. :) I'm specifically looking for spreads/profits on  sub2 deal.  Did a quick search on the forums and there was plenty of information on how to structure a sub2, but little info on spreads. Maybe I'm not searching the correct key words. Don't know a whole lot about the topic, just trying to soak up informaiton. In your oppinion, what is a worthy spread in a sub2 deal (considering, you put no money down and are leasing to a tennant)? 

Almost 18,000 posts Bill! I must say as a newbie to biggerpockets, I didn't think I would get someone of that calliber to answer my post, I'm honored! Please ask any other questions that I might be missing. 

Could someone provide me with numbers on a good "sub2" deal (starting from acquiring the property "subject to" and then lease optioning it to a tenant buyer)? If I didn't provide enough info, please feel free to ask.

Haven't done much on Bigger Pockets as far as networking and knowledge gathering. Figured it's time to start reaching out! Thanks much and look forward to hearing from everyone! 

Im in a similar situation and would appriciate any advice given. -Kris

Yes! Thanks a bunch!!

Hi, just was wondering if many investors are still doing "subject to" deals in the current market? I would like to branch into this arena, but would like some advice if there's some to be had in favor of it. Also, could someone provide me with numbers for a good "subject to" deal (starting from acquiring the property "subject to" and then lease optioning it to a tenant buyer)? If I didn't provide enough info, please feel free to ask.

Haven't done much on Bigger Pockets as far as networking and knowledge gathering. Figured it's time to start reaching out! Thanks much and look forward to hearing from everyone! 

-Kris