All Forum Posts by: Todd Dexheimer

@David Moore a 9-10 cap would be great, but there are no deals in the metro that are selling on a 9-10 cap based on actual right now. North Minneapolis and East St Paul are selling in the 7's and 8's. 

Good to hear positive feedback. I was going to sign up, but wasn't sure it would be worth it. After seeing the response here, I likely will attend it next year, as the price is now up to $1495.

Call a bunch of your local banks. In 2009-2011 I called well over a hundred local banks and found a few that would do what I need. Now lending is easier, so you should be able to get a lot. You can also use other banks to negotiate for your loan. The standard commercial loan is 20-25 years with interest rates a bit higher, but I have been able to get 25 year Am, 10 year balloon at 4.25% interest very recently. 

Unless it's an A class property, I would skip it - even then I would. One thing that you can do it offer it as an option and the tenant can by $20/month or what ever number that you choose for the TV. You could even tell them if the renew their lease for a 2nd year, the TV becomes their's. 

My suggestion is line up financing first and then buy. I bought 5 duplexes out of state cash, renovated them, leased them and had a really hard time financing them. I finally got it done, but it was not worth the hassle. I still invest out of state, but buying apartment buildings 15 units and larger is easier to get financed. 

As others have said, do your background check, verify income (social security, etc), verify rental history, etc. Income can be verified by bank statements and tax statements for anyone. I have no issues with a year up front, just put a clause in the lease stating they are doing that and that starting 8/1/18 (or whatever date), they will begin paying $1800/month as agreed upon. Evict immediately if she doesn't pay. I have have plenty of people pay 3-6 months in advance and have never had an issue. 

 I suggest going through all of the financial numbers very carefully and then showing those numbers to him along with what real expenses are for the property. Be sure you add back in the cost for the property taxes when you're showing this to him,  as well as hiring management and maintenance if he does those items himself. The other thing a lot of people miss would be accounting fees and bookkeeping fees Also  if there are any comps that you can show him with in the last few years that would be helpful as well. You can show him the areas of vacancy rate the current market rent and all of that to ensure him that you are not giving have a lowball offer

I can tell you that an apartment unless it's brand new in Alex is not worth a 6 cap. You're likely closer to an 8 cap on the market depending on the condition, age, location, etc. Also, Alexandria is a small city, so with a little downturn, high vacancy can occur. The last thing is the expenses can be 60%+ if it is a central boiler, especially a steam boiler. 

You're starting out in a great place on BP. Next I would begin reading books on Multi-family investing, financing, managing, etc and listening to podcasts. Also, you may want to intern with a Property Management company, RE investing company, developer, Commercial Broker or commercial lender. 

Look at the income vs expenses. You should be between 50-60% (expenses are 50-60% of the Income). Also, look at the properties nearby to determine rent rates and occupancy. Like @Michael Le said buy on somewhere in between