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All Forum Posts by: Michael Anderson

Michael Anderson has started 1 posts and replied 22 times.

Post: Would you do the deal????

Michael AndersonPosted
  • Lender
  • Toms River, NJ
  • Posts 25
  • Votes 16

I plugged your numbers into my excel spreadsheet and came up with about 5% CoC return OR 10% CoC return if you choose to self manage. I used 5% vacancy, 10% CapEx/repairs and 10% management.

I also didn't factor in any "up front costs" such as any repairs to get it rent ready. I also just bought my first "mostly turnkey" property and discovered that 12k in repairs were needed prior to getting a renter in there. Even if you only keep 5k aside for reserves/up front repairs, that brings your CoC ROI down to 4%.

To echo what someone above said, if you need to self manage to make the deal profitable, its not a good deal. At that point, you are buying a job, not an investment. Even if you choose to self manage at first, the goal is (or should be) to scale enough or want to free up your time enough to hire a PM. If putting a PM in place kills the ROI, to me its not worth investing in.

But then again, i'm just a newbie in here trying to learn as well. Definitely do not have much real world experience to back this up, just what I have learned from others.

Post: South Jersey Meet Up #17 - Lending Options and Mold Issues

Michael AndersonPosted
  • Lender
  • Toms River, NJ
  • Posts 25
  • Votes 16

Hey Guys, 

Thanks for the invite tonight. Had a great time and enjoyed getting to meet a few of you.

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