All Forum Posts by: Minka Sha

Thank you for organizing. I won't be able attend that day. I can after Jan 19th or sometime in Feb - if there is one. :)

The "cost of the landlord" metric is my time. I'm assuming this is 1.5 hour per month if I hire a property management company, so at $50 / hour it works out to be $75 per month.

WOW - THANK YOU Taylor! Your post definitely made joining this forum worth it! :-)

 It's a conventional loan at 3.5%

List price: 354500

Offer Price $330,000.00

down payment $66,000.00

loan taken $264,000.00

Rate: 3.5%

Periods (30 yr)360

Thank you for your input Taylor. For my cap rate calculation. I am adding up all the expenses besides mortgage and then dividing by the purchase price.

Here is a break-down of the monthly expenses: Assuming, 5% vacancy rate, 1.2% tax rate and 6% property management.

mortgage$ 1,332.65

insurance (fixed)$ 83.33

vacancy rate$ 122.50

taxes$ 330.00

property mgr / maintenance$ 147.00

water bill$ 100.00

cost of landlord$ 75.00

misc big ticket items$ 100.00

TOTAL MONTHLY EXPENSES (with mortgage)$ 1,868.49

TOTAL MONTHLY EXPENSES (without mortgage)$ 957.83 

TOTAL YEARLY EXPENSES (with mortgage)$26,885.82

Yearly Cash Flow (with mortgage) $2,514.18

Cash on Cash return: 4%

TOTAL YEARLY EXPENSES (without mortgage)$10,894.00

cap rate(mortgage not included):  3.3%

 Thank you Jeff. The property is this one: https://www.redfin.com/CA/Sacramento/3021-U-St-95817/home/19433701

1) I can do 20% down, investment loan from BOA at 4.3% so that would be ~1200 per month in payments.

2) do 10% down, live in one of the units myself, I currently pay $750 in rent 

Looking at a triplex near downtown in Sacramento. It's listed at 354,500. Now, when I do the math, I'm coming with a cash to cash rate of 7% with an offer of 330k but a cap rate of 3.3%. MLS: 14048301

- What does it mean that the cash on cash rate is higher than the cap rate?

- Is this not a good buy? 

The property has 3 units rented at:

3BR 2BA: 1050

2BR 1BA: 700

2BR 1BA: 725

Thank you in advance for your replies and suggestions!