Posted by kip d burkett on January 24, 2001 at 11:52:32:
There are three complexes, and 56 units. 42 are singles, 14 two bedroom town houses. The value of these propertys is around 1,200,000, and they age from 15-20 years.The owner has stated that he would come down to 500,000 if I could buy him out. Because of the high popalation to housing, these apartments stay occupied. They genarate an income of 20,000 a month, which is low considering that the average rent is 400, and the current owner gets about 305 per unit. The owner said that because he ownes the property outright, when rent prices went up he never ajusted his prices. Here in Arkansas apartments hardly ever go on the market. And the area I’m in, this is the first in the past 10 years. So when something like this comes around it’s a big deal. I’m just getting started in investing, and basicly looking for an equity loan against the value of the property. KIP
Posted by kip d burkett on January 18, 2001 at 21:02:10:
I’m a first timer, and my first deal is a big one. I’ve worked a deal with another investor to buy his apartments. He wants 1000000, but said that he would sign them over to me in order to obtain an equity loan to pay him off. The property brings a monthly cash flow of $40000, and the asking price is well under the listed value. I was wondering if anyone could give me advice or direct me to a lender.
Posted by Ed Garcia on January 19, 2001 at 10:12:41:
Kip,
I’m sorry we need more information. You don’t tell us what state you’re in, anything about you, your credit, your experience, or any information that could be pertinent to the deal. Here are some basic questions I ask myself when approaching a deal.
Commerical list
(1) Describe The Units and the surrounding area?
(2) How old are the units?
(3) What’s the unit mix ( how many 1 br. 2 br etc)
(4) What’s the vacancy factor in the area?
(5) What is the gross income of the units?
(6) What is the vacancy of the units?
(7) What is the NOI?
(8) What are market rents in the area?
(9) Are there any other Units in the area for sale?
(10) If so at what Price?
(11) What are the going Cap rates in the area on multiple units?
(12) Have any other Units in the area recently sold?
(13) If so at what price?
(14) How much does the seller owe on the units?
(15) If there is a loan, is it assumable?
(16) Will the seller carry a second?
(17) Is there any differed maintenance?
(18) If so, estimated cost of maintenance?
(19) How’s your credit?
If you answer these questions, then I can answer yours, with a meaningful answer.
Otherwise, it’s just, What ifs? or hypothetical.