All Forum Posts by: Tristan Morgan

@Frank Greg Thank you! 

Quote from @Frank Greg:

Quote from @Tristan Morgan:

First off , Thanks to anyone who can help me out here with advice or thoughts.

What I have before me and was offered to me was a 8 unit apartment complex.   that's 8 units between 2 buildings.

Building 1 has 2 units rented already making $650/mo each.   the upper units would need roughly $12K in renovations before tenants could move in.

building 2 needs a lot. HVAC, electrical, cabinets, appliances and a little bit of plumbing. as well as the regular rehab such as paint and new carpets.   roughly $60K worth of work.

Owner has told me they want $110K and will let me owner finance at 4% for 5 years.  he would likely take $90K  if i offered it upright.

however this is what I was thinking of doing.   since I have a commercial property that's paid off I could pull equity from.

why not go ahead and pull a solid $175K out of my already owned property. and use it to buy and rehab this apartment complex? that would in theory allow me to have a 20 year loan or so and would help me have  a lower loan payment overall even though at a higher interest rate. as well as giving me the funding to rehab completely and build time to gain tenants. 

Thoughts? advice?  any good contractors you may know that could take this on in our region?

is there anything that im missing? or should cover first?  

again, Thank you all for any thoughts on this.

Tristan

 So you require a total of: $162K to acquire and repair an 8-unit apartment with a current occupancy rate of 25%. Each unit generates $650 per month?

Yes, that is generally what the whole of it is. at minimum. if I can get the parking area paved and a few other amenities they will likely rent at $800/mo.   the current renters are low income fixed rate

@Evan Polaski  Thank you for that insight and questions. yeah the reno seems low. but im lucky to the point of the floors walls, roof and siding are solid and dont need anything but a good cleaning.  whats the big costs associated with the rough building is that the hvac would need replaced on each unit. already quoted to be about 10K installed. as well as some electrical repairs.  these buildings were build new in 1995. and new roofs and siding in 2016.  only roof repair i could find was a damaged vent cap. on one of the peaks. then windows im looking at close to $500 ea to replace and id have likely 6 or 7 of those to do to make the "rough" building weather proof.

If i wanted to sell it after the renovation and a few other upgrades it would probably market for over 300K especially if it was at least 50% tenancy

If the bank would let me mortgage the renovation costs that would be great. cause i would not mind that at all. and yeah the 5 year seller finance is entire loan over course of 5 years , no balloon. but with 25% down.

I currently do not have the cash to fund that renovation unfortunately  but possibly could do the one building and get 4 units ready  then slowly work on building 2. given the one building would only take $10K or so and to get the second building to a point of security and weather ready ( has a few windows vandalized.)  would be a few grand there.

First off , Thanks to anyone who can help me out here with advice or thoughts.

What I have before me and was offered to me was a 8 unit apartment complex.   that's 8 units between 2 buildings.

Building 1 has 2 units rented already making $650/mo each.   the upper units would need roughly $12K in renovations before tenants could move in.

building 2 needs a lot. HVAC, electrical, cabinets, appliances and a little bit of plumbing. as well as the regular rehab such as paint and new carpets.   roughly $60K worth of work.

Owner has told me they want $110K and will let me owner finance at 4% for 5 years.  he would likely take $90K  if i offered it upright.

however this is what I was thinking of doing.   since I have a commercial property that's paid off I could pull equity from.

why not go ahead and pull a solid $175K out of my already owned property. and use it to buy and rehab this apartment complex? that would in theory allow me to have a 20 year loan or so and would help me have  a lower loan payment overall even though at a higher interest rate. as well as giving me the funding to rehab completely and build time to gain tenants. 

Thoughts? advice?  any good contractors you may know that could take this on in our region?

is there anything that im missing? or should cover first?  

again, Thank you all for any thoughts on this.

Tristan

Hello, Im excited to be here and learn more about what REI can do for me and my family .  
1 I am in Logan WV and would love to invest locally due to the growing tourist market in the area as well as id love to invest in growing markets in NC.


2.  since i currently own some commercial real estate and one STR. Im looking to better educate myself how to keep this going and grow my portfolio.

3. Im also a Fire Fighter for my community as well as an extra Ham radio operator.