All Forum Posts by: Niyi Adewole

Good Morning BP Family, 

I am about 10 days away from taking over a 12 unit property that is currently housing section 8 tenants. I just received the leases and they are not the most detailed or complete. I have heard talks of using "estoppel agreements" when taking over apartments to ensure that everyone is on the same page. Would you use the below estoppel agreement for section 8 housing as well? 

@Michael Bronson 

Welcome to BP Michael! I recently moved to Boston from the mid-west and prices here are crazy to say the least. I "househacked" my first property as well (in louisville) and the previous two messages are correct. 

4 units is the max that you can get with a residential loan and would be the best financing for what you're trying to do. 

UPDATE:

Good Morning BP Family, 

I promised i would give an update on the property in the post. Completed the due diligence period and found that there are a few structural concerns that need to be corrected (water and former termite). I had a company I trust come in and assess the situation and give me a quote on correcting it. I requested concessions from the seller ($20K at closing) and will be moving forward on this property. The link below is to the updated deal, first thing you will notice is that it is -$214.51 per month and -2.34%. See value add opportunities below:

https://www.biggerpockets.com/calculators/shared/3...

Value Add Opportunities

Vacant Unit - One of the 12 units is vacant and needs minimal work. I will complete work and get this rented for at least $650 per month with tenant paying electric/gas.

Utilities - All 12 units are separately metered, but the landlord is paying for gas/electric. This is costing $1,012 per month, i will transfer this responsibility to the tenants as the leases turnover. Reducing that cost to (conservatively) $400 or less. 

Turnover - 6 of 12 leases turning over this year (plus 1 vacant unit) i can fix up units with minimal cost and get my own screened tenants in paying for their own gas/electric. The rest of the units turnover mid-way through next year.

Below is what i believe the financials on the property will look by the end of 2019 (conservatively):

https://www.biggerpockets.com/calculators/shared/3...

Good Morning BP Family, 

Does anyone have a good Maintenance/Handyman in the Louisville, Ky area? I am getting ready to turn over a few units on july 31st, and my current Maintenance/Handman has gone missing. I could truly use some recommendations.

Thank you

Niyi

@Jonathan R McLaughlin

Thank you for catching that! I have adjusted the capex to 10%, i PM myself via buildium currently so my actual PM rate is ~2% - 3% (i put in 10 in case i want to move to property management down the road). 

Knock on wood, i haven't had to fight for collections yet. I screen very hard (600+ credit, no evictions, verify employment/previous landlords, etc.). What do you normally budget for legal/collections? 

@Jason Cory

What you wrote makes sense Jason, i will take this into consideration. (sidenote - correction made on the capex, vacancy, and repairs. Capex=10%, vacancy and repairs are now at 5% apiece).

@Alpesh Parmar

You are correct. I was able to get a 15% down, 5.16% interest, 10 year fixed on 20 year Amortization 

@Tony Mai Will do! I believe the property is not operating to it's potential. After the feedback received from here i may need to ask for some concessions on price.

@Jill F. 

Haha "power user" i like it. Happy inspector is great if you take the time to set it up. It comes with "templates", but i created/customized my own template for each unit. For example: if "unit 2" has a kitchen as soon as you walk in, i rearranged the template for unit 2 to start with a kitchen and flow naturally as i walk through the unit. 

Similar to buildium itself, once you set it up how you want it, it works seamlessly and helps keep a paper trail of move in's, periodic inspections, and move outs.