Closed on 7 Unit in Las Vegas

I was very hesitant to speak of this too much until the due diligence was completed and escrow had closed.  On November 3, all that happened and I now own this 7-unit apartment building in Las Vegas.

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Its a great deal for myself.  The essential details are the purchase price is $200,000, seller is carrying back with $27,500 down, at 6.5% interest only for 3 years, plus option to extend for fourth year.  Fixup costs are $14,600.  Net operating income will be $23,756 w/ 10% vacancy factor.  Its a 30%+ cash on cash return based on cash flow after debt service.

Also, I have submitted purchase offers on 3 more residential multi-family properties - also in Las Vegas.  Two of them, will net about $10,000 each on a flip strategy.  Each will offered at better than 10% capitalization rate to the new purchasers. 

Third property that interests me is a foreclosed tri-plex that the listing price was $40,000 - that's for WHOLE building, NOT per unit.  (I clarify because if you live on the west coast like I do, I know its hard to comprehend prices like that)  Estimated fixup costs are $9,000.  Listing agent said rents are $500/unit/month, so based on that net operating income is $9,580 w/ 10% vacancy factor.  That's a 19.5% capitalization rate AND if buying with cash means for $49,000 would own fixed up 3-plex free and clear with NO mortgage to cover, NO debt service.  However... if my offer is accepted, my strategy for this property is to buy, rehab, get rented out, then resell as a "performing, all ready to go investment property" in 4 months (or so) at $70,000, or a 13.7% capitalization rate. 

These properties are a win/win scenario for all parties involved - whether the new buyer is a rehabber, or is looking for a turnkey property with an annual return of well over 10%.  I live in Portland, Oregon so I dare anyone to find close to a 10% capitalization rate here.  Last check, MLS listing prices on duplexes in Portland, Oregon start at about $100,000 per unit ($200,000 each) so good luck getting that to cashflow.

The three latest properties I submitted offers on, I found myself - by the way. I look thru listings every day and find residential multi-family properties with LIST PRICES of $25,000/unit or less.  Are you interested?  Of course you are.  If you call yourself a real estate investor and $25,000 per unit cashflow properties of 10%+ cash on cash returns doesn't EXCITE you, then let's be honest, you're not a serious investor but just a penny wetter.

I will be flipping residential multi-unit properties at 10%+ capitalization rates just for a short while - until I build up my own cash reserves and credit rating from recorded income.  My ultimate strategy is to keep my properties by refinancing after raising the value by rehabbing and renting out.  So if YOU are interested in getting a 10%+ return on your money and have either access to cash, or can qualify for traditional financing (mortgage), take advantage of this opportunity by getting in touch with me while I will be reselling.  Either SIGN UP for the Decisive Newsletter using the form at the bottom of this page, or contact me by contact details at bottom of right sidebar.


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