All Forum Posts by: Matt McCourry

Welcome Josh! Your in luck, Greenville SC is a great place to begin investing, my mentor is looking at a large multi family asset in the area right now! Analysis is a big part of the game, I recommend using the BP calculators and/or building a spreadsheet to calculate the numbers for you. Start with the book "what every investor needs to know about cash flow.......(big long title)" by Frank Gallenillie (big long last name I can't spell)

Chris, Lidicce Rodriguez is correct about the living here for a year requirement. However all the college requires is some sort of proof that you were living here, I know many people who have friends or family living here simply send their mail to the friend /family members residence.

Logan, Congrats at taking the initiative! I am in agreement with Gino Barbaro, Find a partner with the funds to back you on a deal that makes sense, build the relationship, set criteria and goals, find investments. Also, seek out a mentor, someone who has done what you want to do. The real key to this business is not location, but people! -Matt

@John Cohen Glad to see you got that property under contract!  Congrats!

What kind of tenant mix are you expecting?  

@David Dachtera They do, thats why I originally went with commercial loans from a small local bank.  However, they are pretty hesitant right now on doing that, but they always assure me that its an option in the future....  I think because I am young and only been at it a year and a half...  I just barged in the vice president's office of my local branch yesterday and told him about a great deal that just slipped away because I couldn't find a 10% downpayment.  He asked how I knew it was a great deal?  I replied "because the numbers worked and one of the largest investors in town just put it under contract."

@Joe Fairless @John Cohen I also think that may be the best way to go, learning to take great care and put OPM to work is something I have been great at so far.  I am currently seeking any advice on how to structure larger deals with multiple partners; this is where it gets tricky for me....  How much equity do I ask for as my portion?  Especially since my small company (just me, my assistant in the Philippines, and contractors) does all the leg work...  Guys any advice on where to get info on this please let me know....

John, after reading your bio I hate to even tell you this, but currently I am looking at small duplexes that I would put offers in at around the $89 - $110k mark to achieve my desired cap rate.  I also am in the middle of a direct mail campaign that lead me to an owner here in Myrtle Beach that wants to unload an 8 and a 6 unit, I am rounding up numbers for both of them currently....  I plan on doing another direct mail campaign next month marketing to just multifamily owners in the Myrtle Beach area, since this is where I want to focus....

I feel like I'm stuck in the classic "which comes first, the chicken or the egg" conundrum.  Do I get a deal, then worry about financing, or do I make sure my financing is in place first???

  I just had one of these small duplex deals that I mentioned above slip away because I couldn't convince my partners that this was an awesome deal, even though our previous deals are thriving and we almost have all of our original investment recouped! 

Multi-Family Pros,

I currently own several small multi-family properties with partners but want to expand.  My partners are hesitant although the deals work and the numbers check out on several small properties I have in the works.  Our local bank assured me that if I could come up with 10% down I'd have financing no problem.  However, when I say I am flat broke, I am flat broke (personally, not my small company).  All my assets are preforming but I don't want to take any cash out of the reserves to finance new acquisitions...  

Does anybody know anyone who will make private loans so that I can finance down payments?  I think that several of the deals have enough meat on the bone for this type of financing.  

Also, helpful advice and tips from seasoned multifamily investors is always appreciated.  I know some of you must have been in this situation before?  Do I try to seek new partners? Or do I look for alternative financing?

Thanks,

-Matt

@Roy N.

Thanks for the direction and ill take a look at both blog posts!  I am primarily looking at duplexes and quads; although I know they are not considered multi-family properties, wouldn't analyzing them as multi-family be a safer bet??

Also, what do you shoot for in an IRR & MIRR?? I know it depends on the market your in as well as other factors, but what do you personally strive for in your investments??

@Steve Smith 

Thanks for the list of real estate formulas!  It has since been added to my favorites!!

Hello Multi-Family investors!

I am posting my struggles here because Multi-Family is my primary interest and I own 4 units (2 student housing duplexes) and want to grow my portfolio.  However, outside of student housing, I can't find a decent deal at an 8% cap to save my life!!!

Therefore, could somebody please weigh in on how they calculate their cap-rate and if mine is too conservative???

Heres the way I calculate it,

(Gross Scheduled Rent) - (Vacancy rate (at least 5-6%)) = Operating Income

(Operating Income) - (Repairs & Maintenance + Utilities + Taxes + Insurance + Management Fees (at least 8%) + Replacement reserve (capX)) = NOI

Then I simply divide the asking price by the NOI (Asking Price / NOI) to get the cap rate.

I can't find anything above 5 or 6 % at best, am I doing something wrong or does the MLS just suck that bad??

I am in the Myrtle Beach market BTW....

Thanks Guys!

-Matt

Mary Ann,

Thanks for the advice, I'll have to check tenant cloud out!  I did have them all under 1 year leases, seems like the only to go for me.  Way to much stress if it followed the school year. One of the units has been rented for the past two months with no one in the unit!  They are not moving in until mid august.  My kind of tenants!