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Off-Market Fully Occupied Investor’s Ready!

Posted by Powered by Simply Do It on September 17, 2024
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Why THIS deal?

  • ~$700/mo. cash flow once you can refi to 5.5%
  • Cash flows at ~$600/mo. at today’s rates of 6.0%

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  • Pre-MLS: seller plans to put this one on the MLS at $480k.
  • Duplex with 8 bedrooms and 4 full bathrooms (Each unit has 4 bedrooms and 2 bedrooms)
  • List of completed renovations is below
  • Location has quick access to major commuting routes, shopping and schools
  • Highly appreciating area with strong rental market
  • Off-Market opportunity with current SDI client
  • Nothing is wrong with the property, but client is looking to reinvest elsewhere
  • Direct Sale – Seller is looking to sell internally without an agent, however, if the buyer wants to use one that is available.
  • Great Schools!
  • Fully leased on both sides! One side has a new 2 year lease for $1850/mo (until 8/2026) and the other side is Section 8 for $1875/mo.
  • No issues with tenants
  • Section 8 for 2025 estimation: can be raised to $2175/mo. in 2025!
  • No HOA charges
  • #cashflow  #appreciation  #turnkey  #multiplex

Why should you consider this house / what makes it a good investment?

  • Built: 1988 (Reno 2022/2024)
  • Size:3,016 (est) square foot home (total)
  • Low Crime, Desirable Community, A/B Rated Schools

What’s next?

Email/text for address, analysis and to get connected to Simply Do It’s local team that handles this transaction.

Metro:  St. Louis

Team: SDI  – email directly at  jessica@simplydoit.net

Code: 1027

               

Property Specifications2Per Door
 Bedrooms84
 Bathrooms42.0
 Square Feet3016 (est)1508 (est)
 Year Built1988 (R 2022/2024)
 Garage Size00
 Schools Rating (scale 3-30, 30 is best)20
Lot size (sq ft)                 7,187

Purchase Assumptions

My OfferPer Door
Offer used for analysis$465,000$232,500
Suggested offer (low)$460,000$230,000
Suggested offer (high)$470,000$235,000
Asking$470,000$235,000
Market Value (after improvements)$425,000
Estimated Improvements (lower)$500$250
Estimated Improvements (upper)$1,000$500
Estimated Closing Costs$4,650
Estimated Mortgage Costs$3,476$1,738
Other Fees At Closing (pts, . . . )$3,0237%
Total Cost (estimated)$476,898$1,738

Financing Assumptions

 Down Payment (%)35%
 Down Payment Amount$162,750
 Financed Amount$302,250
 Interest Rate6.000%
 Mortgage Term (Years)30
 Monthly Mortgage Payment48.6%$1,812
 Cash Outlay (Total Out of Pocket)$174,648

Estimated Financial Assumptions

MonthlyYearly
Rent (upper)*$3,725$44,700
Rent (lower)*$3,725$44,700
Property Taxes$320$3,840
Insurance$200$2,400
Repairs75$100$1,200
Property Management Monthly (%)7.5%
Property Management Monthly ($)$279$3,353
Leasing Fee75%$116.4$1,397
HOA or Fixed Costs (Water/Sewage)$100$1,200
Vacancy Rate4.0%
Total Fixed Expenses33.7%$1,254$15,043
Total Expenses (Fixed + Mortgage)$3,066$36,789

Financial Analysis / Deal Attractiveness

Years:510
 Cap Rate5.7%7.3%
 Net Cash Flow$49,778$127,685
 Equity Increase$113,071$253,414
 Total Gain$162,849$381,098
 Average Cash Flow/Year$9,956$12,768
 Average Cash Flow/Month$830$1,064
 Average Gain/Year$32,570$38,110
 Average ROI93.2%218.2%
 Annual ROI18.6%21.8%
 Projected Property Value$517,077$629,104
Property Ratings Suggestions
 Item Suggested Criteria (Min.)This PropertyFAVORABLE /
INSUFFICIENT
 Schools (scale of 3-30, 30 is the best)1420FAVORABLE
 Square Feet1,0003016 (est)FAVORABLE
 Bedrooms38FAVORABLE
 Bathrooms24FAVORABLE
 Year Built19701988 (R 2022/2024)FAVORABLE
 Average Cash Flow (at year 5)$125$627FAVORABLE
 Average ROI (at year 5)15%19.5%FAVORABLE

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Original Purchase date :  7/15/2022

HVAC & Water Heater Systems

  • According the an inspection report that was done apporx 2 years: HVAC units are now is ~4 and 6 old (pretty new).
  • Water heaters are (now) 4 and 8 years old

Disclosure Unit #1 :

Mold inspection findings : 

On June 17th 2022 as part of a mold inspection that I ordered (from Wellington Environmental) the following findings were shared:

“The inspection of unit 1029 confirmed visible water staining and visible fungal growth under the kitchen

sink base cabinet. It is suspected that the drywall behind the sink base cabinet is also affected. The

lower level of unit #2 has visible water staining and visible fungal growth on the drywall in the HVAC

room and under the stairs. Discoloration was noted on the baseboard in the basement and it is very

likely that fungal growth is present behind the baseboard in the bathroom and the living area of the

basement. No active water leak was observed in the basement.”

Mold Remediation:

1.  All the lower level walls were ripped to identify the root cause.

2.  The root cause was identified and fixed by a foundation company (The Crack Crew LLC on the week of August 15th). The scope of the work was as follows (per their report):

“On the rear wall under both windows we will grind, prepare, and inject two approximately 4′ vertical cracks for waterproofing  nonstructural repair.”

A warranty on these repairs were provided by the company.

3.  The foundation company also identified grading issues in various places around the house. All the grading issues were addressed to ensure proper grading.

4.  A Mold company (“Moldman St. Louis“) treated the mold (lower level and kitchen) before all the (new) walls were installed.

5.  A complete remodel was done after all issues were addressed.

Over 2 years now and to the best of my knowledge tenants and PM didn’t report on water or mold issues since the findings were identified and addressed. 

Disclosure Unit #2:

In May 2024, a small leak from the new roof was identified and fixed by a certified roofer . The unit was fully remodeled after and any stained ceiling plywoods were replaced. 

Complete remodeling (unit #1 in 2022 and unit #2 in 2024). Partial list:

New Roof

LVP flooring throughout the upper and lower levels.

New Kitchens (cabinets, countertops, new dishwasher plumbing, sinks, appliances etc)

New baths (tubs, vanities, toilets, vents were replaced (but not all))

New paint (whole house)

New blinds

New fans, lights and outlets

New doors throughout the house

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Disclaimer

Information contained herein was obtained from sources deemed reliable, however, Simply Do It and/or the owner(s) of the property make no guarantees, warranties or representation as to the completeness or accuracy thereof. The presentation of the property is offered subject to errors, omissions, changes in price and/or terms, prior sale or lease or removal from the market for any reason without notice.

The analysis is provided “As Is”. All the information is believed to be accurate (except for the small effects of some simplifying assumptions), but is not guaranteed, and depends on the values entered for the property. This analysis is intended for the purpose of illustrative projections. The information provided is not intended to replace or substitute for any legal, accounting, investment, real estate, tax, or other professional advice, consultation, or service. Simply Do It and/or the owner(s) are not responsible nor liable for any damages arising from the use of the analysis info. 

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