All Forum Posts by: Michael Kay

<3 thank you for this

Quote from @Drew Sygit:

@Michael Kay how is your current PMC not avaialble? They should be able to handle within 3 days.

May be time for a new/better PMC

Hi,

I'm in a real bind right now. I have a multifamily in the 63111 area. currently vacant and boarded up. Fire inspector needs in, my current PM can't do it.

i really need help, so any help or referrals are welcome.

Thank you!

Hi,

I'm in a real bind right now. I have a multifamily in the 63111 zipcode. it is currently vacant and boarded up. There was a fire and the insurance inspector needs to get in. My current property management is unavailable. 

i really need to get this done asap so any leads are helpful.

Thank you!

Hi!

I found this great little deal of an apartment building in a major metro area. I figure the units are renting for $2300 each (it's in my neighborhood), down the street from me). 

Building's cap rate is 4% which is the normal for the area. Total deal is around three and a half million. I don't know what the status of the plans (other than 'approved') or the 2 extra units that are proposed to be built.

If I'm understanding things correctly, those two extra apartments will bring in $2300 * 2 per month  * 12 per year/ 4% should give us $1.3MM extra value? 

Like folks have said here, Ohio is great. The whole mid-west is a great place to start for cash flowing properties. Also consider areas of the South.

Cities like Indianapolis, St Louis, Cincinnati, Kansas City, Cleveland, Atlanta, Huntsville, Birmingham, etc. You mentioned wanting to buy a fourplex. Some cities have a dearth of residential MFH, other are swimming in it. Kansas City, for example, doesn't seem to have a large supply of what you're looking for. Cleveland seems to be swimming in duplexes, however.

The best thing to do is to start looking at individual properties in markets, really quickly run some numbers on that property. Eventually you'll notice some trends. Take a look at numbers you have to calculate profitability. Do you notice certain ratios seem to hold up, or that taxes in one area are high compared to another?

I see lots of options you are listing and they're kinda all over the place.

Tell me this: what's most important to you? 

What do you value? Where and what do you want to be in 10 years? What's the point of making money for you? Do you want economic freedom? Bragging rights? Have a passion or cause?

These are only questions you can answer. If it's just money then I would follow other advice about doing an ROI analysis. If it's about freedom, then getting money to live and not live for money is a best guiding principle. You mentioned passions. Do you have a specific vision you'd like to make happen in the world?

No matter what, find the worse property in the best neighborhoods.

Bay area is about wealth preservation than creation. You'll have to out of your way to places like Vallejo, Tracy, Santa Rosa to get something that will be a little bit more attractive, and even then it'll be hard. 

Bit the bullet and get used to buying out of state. 

I think you have a good grasp on my suggestion: Don't get excited about buying trash. Be proud that you said 'no' four times. A lot of deals look good and you have to bail because you have to. Or, ask for a credit from the seller to repair the issue.

If you go with Cleveland (An excellent market, btw), check out https://www.biggerpockets.com/member-blogs/4704/42419-cleveland-neighborhood-grades by James Wise.

Also consider checking out Jame's youtube channel. 

I would also recommend leaving a cushion for unexpected expenses. My first property had a bad roof leak that was a surprise and required a new roof. 

Were you dead set on SFR or are you ok with 1-4 MFH? 5+ apartments? Some lenders will go 15% down on SFR non-owner occupied investment property where as a 1-4 MFH investment needs 25% down. Going with SFR will get you better cash-on-cash returns, they have less turn over. Some of the house prices you mentioned seem kind of low and may not get the best tennants -- if you can get section 8 and a PM firm that knows how to screen section 8 tenants well, then you can make good money.