OFF MARKET buy with inspection already finished [code 813]
FULL DISCLOSURE – SDI's local team (PM & agent) both have a minority interest in this property with an investment group. This investment group is wanting to reallocate funds into a multifamily opportunity.
The inspection report revealed there are multiple minor items that need to be addressed but nothing major.
Market value is ~$250k
Asking is $230k
We believe the seller will accept $220k based on the known items that came in the inspection report.
- Long term tenant. They have been renting since 2015 and just signed a 2 -year lease for $1500/mo.
- New owner will not have to pay lease up fees, renewal fees, vacancy loss, turn costs, rehab costs, holding costs, etc. for at least 2 years along with immediate revenue. Should help with ROI quite considerably.
- This home is located in an old alabaster neighborhood that should continue to appreciate and rents should continue to increase.
- The home could be listed around $250k on high end currently if the tenant was out and home cleaned up. Recently comparable on the same street just sold for $267k. So I think at the $230k there should be some immediate equity gained by whomever.
- We have already completed a full inspection on this property. No surprises here!
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|Schools Rating (on scale of A-F)||B|
|Purchase Assumptions||My Offer|
|Offer used for analysis||$220,000|
|Suggested offer (low)||$220,000|
|Suggested offer (high)||$230,000|
|Market Value (after improvements)||$250,000|
|Other Fees At Closing||$0|
|Down Payment (%)||25%|
|Down Payment Amount||$55,000|
|Mortgage Term (Years)||30|
|Monthly Mortgage Payment||$788|
|Cash Outlay (Total Out of Pocket)||$65,400|
|Property Tax Rate (Approx.)||1.0%|
|Property Management Fee||$130||$1,560|
|Total Fixed Expenses||$574||$6,893|
|Total Expenses (Fixed + Mortgage)||$1,362||$16,346|
|Financial Analysis / Deal Attractiveness|
|Net Cash Flow||$18,343||$43,514|
|Average Cash Flow/Year||$3,669||$4,351|
|Average Cash Flow/Month||$306||$363|
|Projected Property Value||$304,163||$370,061|
|Property Ratings Suggestions|
|Item||Suggested Criteria (Min.)||This Property||FAVORABLE /
|Average Cash Flow (at year 5)||$125||$261||FAVORABLE|
|Average ROI (at year 5)||15%||25.4%||FAVORABLE|
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.