All Forum Posts by: Marco Graves

Ended up getting a different deal, way better, 140k duplex added 50k to it, just got appraised for 270k renting out a bit below market for 2,475 one unit has section 8 so not to worried about tenant job loss. About to finish the refi and pull everything out.

Yeah that's the plan, I should have clarified the paint, it has asbestos siding that's in decent condition which I don't want to touch, but the eves are starting to peel so they need to be scraped and painted, I didn't get a quote or anything but figured it wouldn't be more then that, and I have painting guys that's pretty good so not to worried

Finally found a good deal seller accepted offer and closing soon what do you think, the property is in a good area of town and near the highway so turnover should be low, this is my first deal I found myself.

Property Type: Multi-Family

Lot Size: 15,246 sq.ft.

UNIT INFORMATION

Total Units: 2

Total Square Footage: 1,966

UNIT MIX & RENT ROLL

1 Unit - 3 Beds, 1 Bath

Square Footage: 1,116

Gross Rent: $ 1,350 Per Month

1 Unit - 2 Beds, 1 Bath

Square Footage: 850

Gross Rent: $ 1,050 Per Month

PURCHASE
Purchase Price: $ 141,000
Purchase Costs: + $ 4,230
Rehab Costs: + $ 30,910
Total Cash Needed: = $ 176,140
After Repair Value: $ 235,000
Price Per Square Foot: $ 71.7
Price Per Unit: $ 70,500
RETURNS & RATIOS (Year 1)
Cap Rate (Purchase Price): 11.6%
Cap Rate (Market Value): 6.9%
Cash on Cash Return: 9.3%
Return on Equity: 6.9%
Return on Investment: 35.9%
Rent to Value: 1.7%
Gross Rent Multiplier: 4.9

FINANCING

Cash Purchase BRRR after Renovations

ASSUMPTIONS & PROJECTIONS

Rehab Cost Overrun: 10%

Vacancy: 5%
Appreciation: 1% Per Year
Income Increase: 2% Per Year
Expenses Increase: 2% Per Year

PURCHASE COSTS

Total (3% of Price): $ 4,230

REHAB COSTS

Exterior Paint: $ 800
Interior Paint: $ 2,000
Flooring: $ 2,000
Kitchen: $ 1,800
Bathrooms: $ 2,000
Electrical: $ 3,500

2nd Exit On 2nd Floor: $ 10,000
Replace Drop Ceiling: $ 6,000
Cost Overrun: $ 2,810 (10%)
Total: $ 30,910

CASH FLOW
Gross Rent: $ 2,400
Vacancy (5%): - $ 120
Other Income: + $ 100
Operating Income: = $ 2,380
Operating Expenses (42.9%): - $ 1,020
Net Operating Income: = $ 1,360
Cash Flow: = $ 1,360
Cash Flow Per Unit: $ 680
Monthly
OTHER INCOME
Storage Rental: $100
Monthly
EXPENSES
Property Taxes: $ 275
Insurance: $ 83
Maintenance: $ 192
Capital Expenditures: $ 120
Utilities: $ 350
Total: $ 1,020

Thoughts or ideas

Ahh yes I get what you're getting at, but in all seriousness It's move in ready, and all the trim and molding stuff that normally is leaded in old houses is wood grain so no worry of lead, but ya your right about the laws, if it ever comes up in the future I know who to call though.

Possible 1st investment property trying to get another perspective on wether this is responsible amounts for everything let me know what you think.

** Purchase & Rehab **
Purchase Price: $85,000
After Repair Value: $110,000 (the tax assessment was even higher then this but hoping to refi and pull as much equity out as possible, unsure of how the city and bank assess the property and if it's different though, I need to look into it more)
Purchase Costs: $2,550
Rehab Costs: $2,200
Down Payment: $17,000
Total Cash Needed: $21,750

** Financing **
Loan Amount: $68,000
Loan to Value (LTV): 80%
Loan Term: 30 Years
Interest Rate: 3.75%
Monthly Payment: $315

** Cash Flow (Monthly) **
Rent: $1,250   (possibly more this is on the low end for 3 bedrooms, and even lower for a stand alone house, but trying to be conservative in that the house is on a really small plot of land and has a cliff on 1 side)

Vacancy: -$63 (5%)
Expenses: -$339 (28.6%)
NOI: $848
Mortgage Payment: -$315
Cash Flow: $533

** Returns & Ratios **
Cap Rate (Purchase Price): 12%
Cap Rate (Market Value): 9.3%
Cash on Cash Return: 29.4%
Return on Equity: 14.2%
Return on Investment: 105%
Internal Rate of Return: 105%
Rent to Value: 1.5%
Gross Rent Multiplier: 5.7
Debt Coverage Ratio: 2.7

I had budgeted for 6k for renovations but realistically it probably only needs 2k, it's basically perfect the way it is right now just a tiny bit dated in that it has oak cabinets and wood grain molding. But what's your guys thoughts on this, yay or nay, thanks!

I found a 5 bedroom 1 1/2 bath large single family near my local college for 145k could easily rent out each room for $550x5 to college kids, worse comps are going for 180-280k it doesn't need anything but removing the okish wallpaper and a bit of cleanup and paint maybe 5k total, has tenents already in it (don't know how much there paying) so ~155k total with fees, and cost $1,650 conservatively a month water heating insurance maintenance internet (collage kids), I can't get the loan right now/don't have the time, would this be a good deal for someone to buy?, central mass area, off market.