All Forum Posts by: Philip Williams

look into other areas like rockford, your problem is the 150k for 1500 rent. I have brrr a few properties out here that we are all in for 60k or less and the rent is 1k 

No reason to worry at all, the seller simply wants to save himself some commission lol. As long as you have an inspection and don't skip your due diligence you should be fine. 

Hate to burst your bubble.....there is a zero percent chance it will go for 17,000. Auction.com uses ghost bids to drive the price up, so even if you are the only interested party that is nowhere near where the price will end up. 

Well my first don't would be don't hook up with the wrong property manager lol. I am feuding with mine over rehab costs that are pretty much outright theft! On a positive note properties here have not been overpriced in the last decade or so, even though prices are rising. It is still possible to fine things on the mls that would cash flow day 1 without much effort.  

The part about some of your arguments that I just love is how costs will increase if the minimum wage increases!!!! Do costs not already increase lol? Have costs ever gone down? We put in rent increases yearly, the price of big macs already go up. The only thing that has remained stagnant is wages, cost of living has and will continue increasing year after year. 

having an old fence post driven through a sewer line, it had probably been that way for years and it finally decided to fail right at the inspection.......needless to say we had to dig up the yard and fix it. The post had to be at least 40 years old. 

Now we could simply repeat this as often as we like until we run out of money......or we can leverage against this property pull 100% of our money out of the deal which is what we did. Our leveraged numbers are 

property management 6% 60

insurance 50

cap ex 10% 100

maintenance 5% 50

vacancy 5% 50

taxes 175

Principal and interest 312

cash left in deal 0

coc infinite 

monthly cashflow 203 

pick whichever scenario you like best but i'll take my 200 a month and infinite cash on cash return but that's just me. 

This question should be changed to what is the minimum cash flow per door for a specific asset type. Getting 500 per door with zero leverage is actually very simple to do with SFR, this is one of the reasons people do brrrr deals. For an direct example we bought a sfr in B- neighborhood, this property was purchased at a foreclosure auction for 40k cash. We then put about 10k into the deal bringing us to a grand total of 50k. We then rented the property for 1k a month, in our area tenants pay for all water/sewer/garbage plus landscaping. Our expenses on the property are as follows.

property management 6% 60

insurance 50

cap ex 10% 100

maintenance 5% 50

vacancy 5% 50

taxes 175

The asking price on a multi family we have under contract was 1.2 million which was the appraised value. They wanted a fast close by the end of the year so we offered them 670k and ended up settling on 700k which was definitely a steal. Don't be afraid to offer as low as you think makes sense for your business. After all when the market turns, or the neighborhood turns or whatever you are going to be the sole person responsible for the deal. Offer low enough that you can fire sale if need be, offer low enough that you have enough cash reserves to cover it. Offer them a dollar if you want don't ever be afraid to offer low and upset the seller. 

Seriously though I did a little profile snooping....sorry not sorry. You commented almost this exact same thing almost 3 years ago. Your in stocks you didn't like the signs blah blah blah. Most of us have cash flowed since then, enjoyed depreciation and tax benefits since then and also gotten appreciation since then. So while one day a down turn will come, I will give no credit to those who scream about it every year hoping to get credit when it finally does.