All Forum Posts by: Macayla Fryc

From personal experience in MN / WI, we've had great success with quality tenants and cash flow in an area that's within a drive to a main hub (in our case, St. Paul / Minneapolis), but far enough out (30-40 minutes) that it's lower in property prices with more space and breathability. Especially as folks are leaving the Cities (which also have increased regulations). A quaint town that has a good main-street (like Hudson, WI) is a charm pull for those looking to get out of the cities, but still have access to them. Families who need more safety, folks who have dogs and want a yard, a teacher looking for peace and quiet and a more affordable place to rent, etc.
The applicants we've had apply (143 so far) have held "gold nugget" tenants, including hard-working blue collar folks, professors from nearby college towns, and young, reliable tenants who need something more affordable than in the hubbub of the cities. They also have seemed low-fuss. For context, we have a quad plex with 4x 1-bedrooms in a sunny little neighborhood. Can't speak to how it's going in the downtown areas, but within the last year, *many* of our applicants have cited that they're looking for something more affordable, and therefore, stepping out of the cities.
 

@Mike Moe Hugely helpful! Appreciate the time in detailing that. I'm saving it all in my rental file, and we'll use that frame of reference to build out our own, run it by our lawyer, and help safe guard the upcoming projects. Thanks Mike! 

@Mike Moe

Hey Mike! Writing up your own contract is brilliant. We're looking at several areas both large and small we'll need to bring on a handman / contractor on. Since we've had *terrible* experience with lazy / corner-cutting / disappearing contractors in the past, we'd love to know what your contract looks like. Is that proprietary, or would that be something you could share? Aside from what you listed in your response, are there other key pieces of information you're sure to include?
Also, at what point does a contractor / job size qualify for getting your contract? Solo workman; 5-Man shop; Larger construction group; small sub-contracting project; exterior additions; house renovation; full new build?

Hey John - did you ever find a solution? Did you rent to the couple? Going through my own version of this now, and after I saw your post, thought "YES!" then no one replied. :)

Hey Jamie! 

I was looking through threads for this exact question - we're purchasing our first quadplex, and I was wondering what your own answer to this question is a couple years under your belt! Advice?

Hi! Youngster in the RE world and working on how to analyze initial numbers for cash flow. I've done an overwhelming amount of research and am not coming up with a solid reasoning to this "per door rule of thumb" for cash flow. (I know there are other factors like location, CAPEX, intangibles, major future repairs, etc., but putting those aside for the moment.)

So here's where I'm confused: I've seen plenty of disagreements here on BP about what is and what isn't good per door cash flow (e.g. "You only go for $100/door? I don't even bother looking for properties that cash flow less than $400/door!") 

For our sake, let's use $200/door. That's the min. $ my husband and I want to cash flow per door. We have opportunity to buy multi-family at 5% down (Owner Oc), but when running our numbers, the per door cash flow on practically every property nearby (Twin Cities, MN) seems pretty tight (~$175/door), not meeting our $200/door minimum. However, say we did 20% down (which may be more akin to a property investor's DP?), that's a difference of a couple hundred dollars! All of a sudden, those same properties that didn't seem to cash flow for us look a lot more desirable. 

My question is this: When you consider your per door rule of thumb, *what is the down payment that is paired with your rule of thumb*? 

Hypothetically, if all variables are exactly the same, is a MF with 5% and $~175/door comparable to a MF with 20% and ~$375/door?

Thanks!

(Per door cash flow is just part of our initial criteria, and we understand there is a lot more that goes into evaluating if the property is actually a good value.)