All Forum Posts by: Tim Cooper

Seems like a great deal to me if you are looking for buy and hold.  Your Return On Cash is great.  I would take 1/2 of the $1363 net to pay down the mortgages faster to build up your equity.

Another great tip.  Thanks @Mike M.

Hi Don,

That is an excellent way to get started.  In 1988 I bought my 1st house & got a roommate.  Then I sold it 2 years later and bought a house and a 5 unit apartment building.

Best of luck to you.  

Hi Jordan,

Good point.  That is one of the questions I will ask the listing agent when she calls me back.  I'm assuming right now that is what they were rented at.

I am pretty familiar with the area and these seem reasonable.  But I will also do some market research on the exact neighborhood.

Tim

I would like to get some opinions on a property.  I found a 3 unit in a near by town that is a bank repo by an out of state bank.  It has two 1 bed and one efficiency apartment plus a 2 car garage.  I drove by and talked to a lady I saw outside.  She  and her husband has lived there 5 years.  One lady just died and another went to assisted living.  So currently 2 of the units are vacant.  The lady and her husband are painting the units for the bank.

Outside looked OK.  There is a steep hill that slopes directly up to the back wall that makes me a little nervous.  But it's been there since 1952, so it must have been retained pretty well.

I didn't get to see inside yet, but I'm guessing there is some deferred maintenance but have no idea.

This is what I would guess to be a B building in a B+ neighborhood.  (I never have found a definition of the grading system of properties and neighborhoods.)

Here are the numbers:

Asking price $69,900

Rent 1 $435

Rent 2 $515

Rent 3 $530 

Taxes  $222

Maintenance $74

Cap Ex $148

Garbage $50

Vacancy $148

Let me know if you need any more info.  

Neat tread.  Knowing when to walk away is as important as knowing when to jump in.  

I have been having a hard time finding anything at a decent price in my area at this time.  I can't believe what some people are willing to pay for rental income property in this area.  Apparently they can afford a negative cash flow, or they aren't on BiggerPockets and don't realize there's going to be a negative cash flow.

LOL Tyler, I thought the same thing about the range hood. I have had rehabs where I had blown my budget so I repainted the range hood and it looked great. So I spent $4 instead of $50.

I know the reality shows aren't really real, but watch "Hotel Impossible"

I would run away from this property. Many many bad issues, (mold, negative equity, declining neighborhood etc.) and the add to that she is like a family member. It is admirable that you want to help a friend, but this is the type of deal that can make a real family member let alone a friendship go bad.

Good luck with your decision.

Hi Zacharias,

Welcome to BiggerPockets.

Geee, I'll be your friend for $100/ month favor. Not a good idea when you are in a negative cash flow situation, but it is a good friend.

One thing you didn't do is add rent increases. When you are projecting that far out, you should plan on 2-3% increases in rent. So the picture isn't quite as bad as it seems.

That being said, I would probably try to sell and look for a property that you can get to positive cash flow.