All Forum Posts by: Robert Burns

I need some help with the best strategy to use for a potential deal on a SFR I found recently.
The owner is a recently divorced individual who got his previous home in the settlement. He just leased it today for $950/month but he real objective is to sell it and walk away. It's a nice 3/2 in a good neighborhood and worth about $130K. He told me on the phone he'll consider selling it at a reduced price to just get rid of it. I drove by and looked in the windows. The outside is in pretty good shape. The garage door needs replacement and from what I could see inside it needs cosmetics, paint and carpet.

My idea at this point is to buy it at a deep discount, 30% below ARV and lease it back to the current tenants or get a lease purchase.

What are some negotiating ideas/strategies I can use to get this property and end up with the best deal possible?

Latest income numbers for 12 plex.

PURCHASE PRICE: $350,000
Avg/Month Annual
Income 5,251 63,012
Expenses 3,487 41,846
Net Income 1,764 $21,167

Annual Insurance (est): $4,375
Annual Taxes (est): $3,850
NOI: $12,942

NOI/Purchase Price: 3.70%

What do you think of the $350k price?

I appreciate the responses and have posted the numbers below.

Your input is welcomed.

12 Plex Financials
2008 2009 2010 Thru Apr
Total Total Total
INCOME
RENT 59603 61659 19995
Other Income 1726 1618 213
Late Fees 545 454 77
TOTAL INCOME 61874 63731 20285

OPERATING EXPENSES
Maint & Repair 5999 13838 841
Plumbing Repair 2937 1906 0
Electrical Repair 491 5248 75
Painting & Wall Repair 2880 0 0
Heat & Air Cond 3252 7568 95
Appliances Repair 659 1135 102
Lawn Care & Landscape 50 0 0
Pest/Termite Control 193 213 145
Cleaning 624 345 108
Carpet Cl, Repr, Rplc 1278 823 -31
Management 4162 3826 1217
Condominium Fee 240 240 80
Electricity/Sec Lighting 2588 2208 924
Water & Sewer 7243 7301 3100
Trash/Waste Container 3286 3236 1128
Legal & Accounting 276 0 0
Advertising 61 91 0
Misc. Expense 79 32 0
TOTAL OPERATING EXPENSES 36298 48010 7784

TOTAL OPERATING INCOME 25576 15721 12501

CAPITAL EXPENSE
Roof Replacement 250 0 0
TOTAL CAPITAL EXPENSES 250 0 0

NET INCOME (LOSS) 25326 15721 12501

ADJUSTMENTS
Tenant Deposit 600 500 -1100
Owner Draw -25926 -16216 -9901
TOTAL ADJUSTMENT -25326 -15716 -11001

CASH FLOW: 0 0 1500

I need help analyzing the financials for a 12 plex apartment complex I am considering buying. One of the main questions I have is based on the numbers what would be a good selling price?

I currently am doing lease options and matching tenant buyers and sellers for an option fee. Can I do the same with mobile homes?

Jon,
Can you show me the calcs for the 2% rule?
Thanks

I just came across a potentially good deal? on a 12 unit apartment complex in my city. The apartments are (8) 2/1 and (4) 1/1 renting @ $575/mo and $525/mo respectively. $6,600/mo and $79,200 gross rental income. The complex is in a reasonably good area of town right across the street from a public school. They are fully rented and it's my understanding the vacancy rate is very low. The property also appears to be in great shape, new roof and no rehab. The price is $379K. I have not purchased apts before so I need some advice on what to offer. I have a buyer who is interested in properties like this, so I intend to make and offer and sell him the assignment when to offer is accepted with an inspection clause. I am talking to my realtor to get the expenses so I can calculate my NOI.

Any comments/suggestions will be appreciated.

interesting responses. I just think the format was changed for the sake of change. Maybe someone can point out the improvements provided by this format.

I recenlty found a condo complex in my town where several of the tenants want to move out and are offering their condos at low prices. I am very interested and called the property management company to see if there were some negatives about the complex that I was unaware. So far I can't find any major problems. Any experiences investors comments would be welcomed.

I really liked the old Forum format where you clicked on Forums and they each opened up with the headings and the latest posts.

I am having difficulty finding the right Forum to post for a particular topic.