All Forum Posts by: Tim Soto

Yes, you can discuss owner-financing with a potential seller as long as you disclose that you are a licensed agent. 

Great points here. In my personal experience and opinion, if I knew the neighborhood and the numbers worked out for me, I would buy knowing that I am an active investor/owner/manager. I would get to know the local authorities who patrol that area and ask about the activity, if any, of the abandoned property. I'd work proactively with them, including trying to buy that abandoned property. See if it's on the city's list of code violations and what can be done to fix the blight. 

It all comes down to how active of an investor you are or want to be. 

Hope this helps. Good luck!

Tim

Thanks @Tony Cavalli !

Thanks @Ramon Jenkins for the complement !

I'd go with price reduction to lower that value, which in turn, would lower your tax payments. You could also tell the seller that a price reduction would also lower their payment on capital gains taxes also. If this property is NNN and taxes are covered by tenants, then get the credit for deferred maintenance.

Hope this helps. Good luck!

Regards,

Tim

Hi Tony,

I'm an investor friendly agent in Ventura County. I'd be more than delighted to help Ron achieve his investment goals. 

Thanks,

Tim  

Hi Igor,

You picked a great market. There's plenty of activity in Las Vegas. So this is a retail center? There are many different details one must pay attention to and cover during the due diligence process to avoid potential pitfalls. 

I would definitely go with a local broker/agent, where the property is located and preferably one who specializes in those types of properties. CA and NV likely have different laws in regards to real estate transactions, which could pose a problem for your CA agent. You could ask him to refer you that NV agent so that he gets a referral fee. 

Based on my personal experiences, here are some questions that I would ask and verify during the due diligence process, which may apply to you: 

Do these 3 tenants occupy 100% of the building or is there vacancies (opportunity)? Does the Cap Rate work for your investment buying criteria (return on investment, given that you paid all cash for the property)? Are you financing this property through a lender, and if so, will you cover the Debt Service Ratio for the lender (for every dollar in mortgage payment, lenders want to see about $1.35 in Net Operating Income)? How long are the leases and how long do they have to be for the lender to consider them strong? How long have tenants been there and have they established their business there for the long term? If any leases are due to expire within the next 24 months, are tenants planning to resign, and if so, will they sign a Letter of Intent for the lender? Who pays what (taxes, insurance, utilities, maintenance)? Is there opportunity to off-set expenses to increase NOI and value? Your agent should help you with this process and other disclosures pertinent to your transaction.

Hope I was helpful. I'm sure more experienced commercial investors will give you some great pointers too. Good luck on your deal!  

Regards,

Tim

Hi Daniel,

Welcome to the BP community! I'm definitely interested in meeting up with BP members around the area. Look forward to connecting.

Tim

Hi Kyle,

Yes, I agree that you have to first see if the numbers work out for you with 5% and 10% down. When you approach the seller, build rapport while discussing the reason for the sale because that's going to make them want to do the deal with you. The more issues there are (deferred maintenance, under-managed, vacancies, etc), the better position you will be, and the more the seller may consider creatively structured financing.

If the numbers end up working out for you and the seller is open to carrying paper, offer incremental down payments, which has worked for me. For example: Purchase price to be $______ with 10%-20% down payment. 5%-15% of the down payment to be deferred for a period of 6-12 months. This would allow you to increase income, build reserves, force appreciation, and be in a better position to pay the rest of the down payment. Negotiate and work with the numbers that will benefit you and ultimately solve the seller's problem.

I hope this was helpful. Good luck!

Regards,

Tim

Hi Melissa,

Welcome to BP community. I'm from Ventura County also. Let me know if I can answer any questions and be of any assistance to pursuing your investment goals. Looking forward to networking.

Regards,

Tim

Hi Jag, welcome to the BP community. This is a great platform of information and resources to help guide you. I also live in Ventura County and am seeing low inventory in this market. 

Regards,

Tim