All Forum Posts by: Gaspare U.

How about you start off with an introduction to yourself here. Like what have you done and your experience.

Right off the rip your CapEx, Vacancy and Maintenance seem low. I see some veterans here use a 21-23% combined on them. I would use a 25% and if I have some extra cash at the end of the month that's great.

Also, is a 3.5% rate realistic on a commercial property? Mind sharing how you get that rate, I would love to have access to that as well. Please and thank you!

I think the real answer is:

Can you and your Partner come up with the 20% cash needed in time? If no, you don't have this as an option. If yes, then:

Contact a few bankers and see what it will cost you to raise more capital on the equity built into the homes you have. Then contact your accountant and see what the real cost to borrow is. Once you have those numbers compare that cost vs the cost that you missed investing on the 20% you and your partner raised.

Make sense?

Just curious:

1. Utilities. If this is a single family unit, why not let the tenant pay their own? 2. Management. It's a single TH, why pay someone to collect a check (do it for free with Cozy or similar service). I assume the association manages lawn, snow removal, etc. Is there something you need managed that I am not seeing?

I have limited experience in buying.. I was born into the buy them and hold them model. But I do NOT think I would ever let one single "rule" that investors use as a "guide" determine if I would buy or pass on a property. 

If you like the area, and feel your numbers are very conservative and the comps match. What's the holdup; my rent isn't 2% of the price? Compare two homes selling for 500k and both collect 50k a year in rent. But one building the tenant pays for all utilities and the 2nd building the LL pays for gas and water. Which is the better deal? I assume both would have the same numbers in regards to the 2% rule correct?

Just my humble opinion.

@Vincent Gable

Hi, can you post the report as a link? It’s difficult to read as a image in the post.

I grew up dealing with a multi fam where none of the utilities was separated except electricity. Here is some advice if you like. From the looks of that building it isn't a high society area. Here are some things to consider:

1. Vacancy. You need to find out how long and how much it takes to evict someone. You have two options be a bulldog and LL and evict the trouble makers otherwise the trouble makers will chase the good people away. So up that percentage, perhaps 12% to include lawyer fees. Also, it's great feeling to be paying gas and water bills when the tenant refuses to pay the rent.

2. Water. Who is going to alert you that the pipe is leaking, toilet flap is not sealing, someone left the hose in the backyard/slop sink on.

3. Single thermostat/gas bill. Be prepared for calls and complaints. Be ready for the frozen bag of peas on the thermostat to crank the heat. Be ready for windows wide open.

4. Super. You will need someone to manage the trash. He needs to take out the trash or at the very least make sure it's separated and not have litter all over the ground. You will get a fine for trash.

Any similar type of property will need a really good Super is is getting an amazing deal and does not want to F#@& it up. Will make sure the trash is organized, water isn't flowing for no reason and will mob and clean common areas. Have the lawyer on speed dial and make sure you get rid of bad seeds and make sure you keep the good tenants happy.

Me personally, I won't look at a building w/out separate utilities. I burn through enough cash just on maintenance. Good luck!

@Bryant Bagley

Funny I saw this, just today I signed up for Cozy and hope it’s good. Here are the two things I initially found issues with as of now.

1) No itemized charges. Meaning, I would like the invoice to show different things (rent, water, landscape credit, etc). Cozy DOES offer the opportunity to charge one time fees for water etc.

2) No late fee by day. Meaning Rent is due the 1st, if not paid by the 5th there is a $10 per day late fee. They only offer a general $50 late fee.

I currently use waveapps to send invoices, manage accounts, bills etc. It’s free and pretty good, not perfect but pretty good. I think I will be using both till at least the end of the year and decide if I can do with one.