All Forum Posts by: Ryan Anthony

@Jaysen Medhurst

Thanks! I have a repair contingency factor built into my spreadsheet. I think it’s ~12% of MV but I didn’t use it for this analysis. Either way it gets across the same point... budget for unseen repairs!

@Jaysen Medhurst

Great feedback!

• I understand the purpose of cap ex. Appreciate advising a more conservative budget of 15%. I’ll use it for future analytics.

• In terms of lawn care the tenant will be responsible. It’s a good point but the research I’ve done so far shows my market leaves it to the tenant.

• what method do you use to validate rent in your market? For SFR I compare rent rates of similar properties in the area.

• I didn’t use a percentage for the tax amount (despite listing a percentage beside the value). I was able to find the tax rate on the web for my city. I did however use one for insurance. I’ll consult a local insurance agent to get a better estimate. I assume they use a system to determine rates based on factors like price, size, condition, rooms etc

• For properties that appear rent ready how much would you budget for initial repairs?

• When I called my bank for a consult 4% wasn’t for an owner-occupied property. However she did say the rates were low currently and fluctuate depending on the economy. That said I think it’d be wise to use a more conservative rate given it’ll change.

@Noel R. thank you for the response!

Called my bank today and they do offer 4% with 20% down. What would budget for cap ex and why? 5% is what I've seen the most in BP.  Yes tax and insurance are monthly. I have included maintenance costs.

Hello BP Forums!

 I've just begun learning about real estate investing and have gotten interested in buy/hold strategies. To build knowledge in my local market I've challenged myself to analyze one property a day. Would love to get the communities constructive feedback on the following property and analysis. What do you guys think? Most of the numbers I've gotten are from reading books or internet research.

I've set my criteria to 3 BR 1+ bath SFR's that I can purchase with >$200 cash flow and 12% ROI.

The property in the photos was listed at ~187K. I believe it has a market value closer to 170K based on similar sold properties in the area. I would plan to make my money going in my offering ~136K or -20% of MV (may get laughed at but hey never know until you ask and then can negotiate). I'd make a 20% down payment. 

Total cost of purchase would include hold costs (3 month rent), an inspection and closing costs (3.5% of purchase price). 

The property looks rent ready so zero repair costs.

I anticipate it will rent for $1.5k. Expenses include 5% vacancy, 5% maintenance, 11% property management ( I wont hire initially but need to budget it in), insurance and 5% CapEX.

Property principle and interest is based on a 30 yr 4% mortgage payment on the amount financed ~108K.