All Forum Posts by: Marc Rice

@Allen Tracy

Rentometer is good as a reference but I always recommend checking actual listings on Zillow/Apartments.com/etc as well as checking with a property manager. I always think it’s important to not just look at bed bath count but the entire units layout and amenities. You’re renting a place for someone to live, not just bed/baths.

@Alex Craig

Do you think there is a middle ground such as hiring a project manager employee to coordinate subs and projects?

Yes, that's important to consider. But that's also where all the return on investment is. Find good local partners and scale.

@Marc Rice

Does not include debt service in my above rule.

@Brad Campbell

50% rule is a conservative rule of thumb that says 50% of months rent will be your expenses. Subtract 10% of that for self management so estimate 40% (still very conservative).

@Kishun Barker

Check out Columbus, higher appreciation and strong cash flow so when you find a good below market deal and buy it in cash, you’ll have an easier time cash out refinancing and scaling.

@Alex Boyce

I’ve found studio-1-2 beds do the best as STRs in my local market due to high volume off small groups traveling, especially with covid I’m glad we stuck to that strategy.

I’d recommend talking to some other hosts in your area and looking at similar properties on Airbnb that you’d be buying to see numbers.

There’s appreciation, cash flow, rentability to consider. What if that local city prevents STRs, will you have a backup as a LTR?

Thanks Nick! The two lenders we spoke with hold portfolio, they used to be 25 but now are 20 due to covid. Great idea to check with a mortgage broker.  

Yeah I have heard of large prepayment penalties as high as 4-5%. My clients are ok with where the rates are at now and taking the risk since it's a good deal. They're just having trouble with the amortization piece now 

Hello BP! I've been working with some buyers on larger apartments around the $1m purchase price and have found some solid 1% rules in great A-B neighborhoods but the issue I'm running into is that commercial lenders are only willing to provide 20 year amortization loans instead of 25-28yr normal. I have heard of Fannie/FHA apartment loans up to 30-35yr amortizations but am very unfamiliar with that space.

Does anyone have any recommendations on where to find longer amortized commercial loan products? Located here in Columbus, OH.