ctrmrz31 0 Report post Posted January 8, 2004 Great job Steve!I really enjoy seeing these deals unfold right here on the naked investor. I think we all learn a lot from it. I have my fingers crossed for you, but it's hard to type this way !Cruz or Brandon? Share this post Link to post Share on other sites
Mr Saint 0 Report post Posted January 8, 2004 Nice work Steve. We would love to hear what the numbers are when you get this thing buttoned up. Cheers! Share this post Link to post Share on other sites
ronsewell 0 Report post Posted March 3, 2004 Good information and advise on the mixed use side of this deal. However, commercial loans are available with 30 year amoritizations without any balloons or restarts and some come with rates much lower than current residential property. Ron Share this post Link to post Share on other sites
<Steve> 82 Report post Posted March 4, 2004 Sounds interesting Ron. How can I contact you to get additional information? <Steve> Share this post Link to post Share on other sites
verbatim 1 Report post Posted March 5, 2004 So Steve, did the seller come down on the initial price? You said he was asking FMV? If so, What would the profit be for you on this deal? I assume you would get monthly cash flow and money on the back end right? Share this post Link to post Share on other sites
<Steve> 82 Report post Posted March 5, 2004 Hey verbatim- The seller did lower his price slightly form his asking price; however, with this deal I wasn't concerned with back end profit. I know after 5 years or so, the property value will increase and that will be the icing on the cake. My concern is monthly cash flow now and getting possession of the property with no money out of my pocket going to the seller. I am typically a buy and hold investor. I think there are several options with these properties being on a l/o. Sell to a tenant/buyer, if one of the properties works well as a straight rental buy it myself, or give the property back to the seller if it doesn't work when the l/o term has expired, or just do a straight sell. It really depends on current market conditions. Right now it is still a buyers market; however, the demand for rentals has increased since last fall, and finding those good tenants has become easier thank goodness. It has been rough the last couple years. The seller did reduce his monthly profit he received from rents. I average $150 per month on each property. With (4) properties that is $600 per month or $7,200 per year cash to me. Just what I was wanting more monthly cash flow. As rents go up over the next few years so will the cash flow. Any deposits or option money will be stashed or a portion of it stashed away for repairs and any vacancies. The seller will benefit over a longer term as his mortgages will be paid down and he will receive more cash at closing. <Steve> Share this post Link to post Share on other sites
Rich 0 Report post Posted April 24, 2004 how do you lease option a duplex/fourplex, the units are already rented , does this work the same has optioning a single family home. and how does the seller receive monthly income. Share this post Link to post Share on other sites
MichaelC 160 Report post Posted April 24, 2004 how do you lease option a duplex/fourplex, the units are already rented , does this work the same has optioning a single family home. and how does the seller receive monthly income.Yes, it is basically the same as a SFR. With a multi unit property, there are a number of approaches you can take. For example, if the fourplex is already rented with straight tenants, you may have a tired landlord who wants out of the hassles of tenants and toilets. Now, let's say this property cash flows $500 per month on all four units. Do you think it might be worth it to this homeowner to accept a lease purchase deal from you where his cash flow is cut to, say, $250 per month in exchange for you taking over the responsibility of the property? Quite possibly, I'd say.You, on the other hand, now have a master lease on a property that is already filled and generating an immediate $250 monthly cash flow. If you were crafty enough to lock it up for 36 months or more, the appreciation that occurs over that time is your's. In that time, you may have the opportunity to increase the rents and, thus, your cash flow. After three years this property may very well be worth quite a bit more than your option price. Now it becomes a fairly easy property to finance and purchase, and you have easy entry into a cash flowing multi unit property. Smart move, dude ! Share this post Link to post Share on other sites
-Tony- 0 Report post Posted June 5, 2004 Hey steve I know I am late but the 1031 exchange is 1 for 1 of equal or better. So, he couldn't have grouped them they way he wanted anyway Share this post Link to post Share on other sites
