All Forum Posts by: Regen Place

Scott,

I think your numbers look pretty good overall.  I would check with your lender and see if in fact they are doing 30 year amortization.  I am looking at an 8 plex as well and every lender I have reached out to are only doing 20-25 year terms.  If you can secure a 30 year amort that is great! I also would look into what appliances the seller is wanting to negotiate about.  If they are wanting to be compensated for quite a few appliances or negotiate over them that could skew your final numbers.  I think the deal has potential for sure!  Check when the roof was replaced and the age of the mechanicals too.

Good Luck!

Daniel,

Have you called some insurance companies for insurance quotes? I am not certain but $3000 a year to insure a duplex seems high. I typically pay around $1200-1600 per year for similar properties. I also think your expenses for repairs might be a little high. It's good to be conservative and have enough reserves for repairs, but you might be able to set aside $150 per month and be fine. I am still learning but those are two areas you might be able to increase your cash flow numbers.

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Thank you in advance for your thoughts on this potential purchase.  6 of 8 units have been upgraded and new roofs on each 4 plex in 2017. Mechanicals are newer with exception of two ac units.  The terms on most commercial lending I have found are 5-year term on interest rate (readjusted every 5) and 20-year amortization.  The cash flow is much better on a 25 or 30 year amortization, but I am having trouble finding those terms without paying around 8% interest. interest rates are definitely on the rise.

I think long-term the investment could be good and would cash flow $25-26k per year after all expenses and after the loan is paid off.  I am torn on if it is a smart investment or not.  

@Alex Bekeza Thank you sir for your help and advice!  Have a great Tuesday!

Good afternoon everyone!! Could someone please provide some insights into a commercial lender with favorable terms (something like a note readjusted every 5 years and 20 year amortization). The property is an 8 Plex located in Kansas City, MO. 

Thank you for any advice or help you might be able to provide. 

Could you please send me some further details on this property? Is the unit under property management currently? How long are the current leases for? If you have any additional photos that would be great.

Thank you,

Regen Place

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I am active in Butte. Please send me some additional information about your properties. 

Thanks!

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Sorry this happened to you.  Obviously Morris needs to be shut down and made well-known to the public how they operate.  I realize it can be labor intensive but I have to agree with other posts about physically visiting the property before a purchase is made.  I recently invested in the midwest and made two separate trips (9 hour drive one way) to research the area and meet my realtor/property management team etc. before buying a duplex.  It is possible to buy sight unseen but you need to have a fully proven team in place (realtor, contractor, property manager, lender, etc).  If you have the time and money I would legally remove the squatters and try to save the investment.  If you can find a reputable realtor or contact who might be willing to provide live video of the renovations as they progress you would at least have that as a piece of mind.  Tough deal no doubt.  Moving forward try to physically set foot in the investment before committing or have a reputable team do it for you if you cannot be there.  Good luck moving forward.

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@Stace Riley, I have a friend who is a realtor in Lansing/Leavenworth. He has only been in the profession for about 8 months so he is pretty green, but he set me up with MLS search that sends me emails on any new multiplex or qualifying single family home in the area of Northwest Kansas City stretching up to Leavenworth. I found a property management company that was recommended by another Bigger Pockets member who invests in the same area. The company is Echelon Property Management. The deal is set to close in 2 weeks, but the tenants are in place and the cashflow is going to be good (but time will tell). Our properties are all over the place unfortunately because we move every 3 years so we are in Killeen, TX, Colorado Springs, Kansas City, KS, Bozeman, MT and Great Falls, MT. I feel like the price points and cash flows are really good in the area. Memphis, TN, Cleveland, OH, Pittsburgh, PA, Raleigh, NC, and Huntsville, AL are all on my radar as well.

I second your method of military bases.  The money from BAH is a guarantee for the most part and getting officers (Lieutenant, Captain, Major, LTC, are best).  Good luck moving forward man.