All Forum Posts by: Mario Brown

This home is the product of direct mailers and is in the prestigious "29605." Only other sell on this street sold for 175k in 2 days. Here is the Link.

@Sara Eastler @Chris Seveney Thanks for your time, particularly without enough info. 

Financing

80 % ARV @ 4.5% 20 year note that can be adjusted at 5 years first 3 months are interest only. (This is for the property & rehab)

Unit Mix

6- 2 bedroom 1.5 bath

2 -2 bedroom 1 bath 

Due Diligence Period

45 days until money goes hard 

Condition

Average condition. 

Utilities

Tenants Pay Utilities

I have included a snap shot of the property as is with financing only for the property  (not rehab) 

@Ashley Pimsner

Good Points, thanks for you time. 

I am assuming the same 15% vacancy and collection rate. 

Expenses should be lower but i didn't adjust as i felt that would only make the projection MORE optimistic? 

I have never heard of RUBS, until now. Thank you. Currently the tenants are paying their own utilities and common air utilities are minimal.

@Marc C.

Fantastic point, what cap rate would you use when building out a 5 year pro-forma?

Nancy & Bob are solid agents have done transactions with them. Let me know if I can help you with networking. 

Hey @Ashley Pimsner that is NOI. Should have specified.

Forced appreciation is one of the biggest opportunities i see in MF over SF, but i don't know if i am thinking about this the correct way.

If I am buying a $21,620 revenue stream for $239,000 (9 cap), with an investment of $80,000 i  improve and stabilize the asset through a section 8 re-positioning,  shouldn't i then be able to and sell a new and improved $36,208 revenue stream for for $439,911 in 12-18 months. (9 cap)

Hypothetically, would a better looking, managed and performing asset be able to get an 8% cap rate? Assuming so the value would be $452,600? 

So here is the deal that I have under contract, i would really appreciate some good ole BP feedback on this. Thank you for your time. 

Purchase Price -   $239,000

Gross Potential Income-  $48,672

Vacancy & Collections 15% - 7,301 

Net Income - $41, 371

Expenses have been a bear to get out of the seller, but VERY conservatively i have operating expenses at 48% ( Property Management, Utilities, Taxes, Insurance, Eviction costs, accounting  and legal, repair)

This is a classic  value add and re-position, rents are at $500 and should be $700.  

Because the grade, ( C Average) I have increased vacancy and collections from 12% to 15%)

What are your general thoughts?

spot on @Sara Eastler :)

@Mateusz Prawdzik absolutely man that makes more sense, sounds like it is less about this particular purchase and more about you building a network and finding a mentor or two? That is exactly how i got started.