I’ve been reading, a lot, of books about investing and property investing since I was 18 years old. I acquired my first property literally the day I turned 27. I still have a whole lot to learn, but I “THINK” I did good on this deal. I really would like someone to analyze the deal and tell me if I did amazing, good, ok, bad… etc. I’d also like to know why…
To start The building is a Fourplex. They are all one bedroom one bathroom units.
The property is located on a corner lot on one of the best streets in the area. it’s zoned MUC-1, so I can turn the units into offices, retail stores… etc. The street is becoming the trendy hang out area with A LOT of pedestrian traffic during the summer (Car traffic too since I am considered “down town”) it’s next to Coffee Shops, Hair salons, Restaurants, Pubs, parks (where they do live concerts every thursday during the summer) and much more… Again, a very cool historic street with lots to do… They consider the street I am on as the “Heart” of the city.
The lot is actually two lots. I can remove my garage and build another building on the property. Since I am commercial zone, there are zero set-backs. The building on the second lot would too be MUC-1 (so I can do more rental units or commercial) I think if i did rentals, I could get 2 more. My only limitation is the lack of parking spaces.
the building itself is a Historic building. This means the city can dictate some of the things I can, cannot do. However, I get Grant money. $10,000 matching and $3,000 matching for repairs on the outside. I’ve worked out a deal with the City to receive two of the $10,000 grants to do repairs and landscape.
I paid $230,000 (this includes all closing costs) I got a 6.5% 30 year loan. There is a lot of repair work needed, but I am doing it all pretty much solo, so all I’m paying for is materials. I figure I’ll be about $40,000 into it BUT The City will pay me back $20,000 of that through the grant, so I’ll have $20,000 of my own money.
The apartments can rent for $650 for two, and $625 for the other two (as of today) I might even be able to get more, but I’d rather keep it lower to figure out this deal.
I pay water, sewer, garbage and utility room electricity. I figure I’m about $300ish a month on that.
There is an Onsite laundry where I have coin-op machines. I figure I’ll be about $100/mo on that (but I’m only charging $1 per load and $1 per dry. So I can up that to at least $1.5
The area itself is going through A LOT of changes. I’m only 7 blocks from Main street (with even more shops and restaurants) and about 10 blocks from the River. They’re making the main street pedestrian friendly including a new boardwalk to access the water. They’re building a new “out door style” mall with an IMAX theater and Restaurants about 1.5 miles away. And they’re building water front condos with high end restaurants and parks.
I hope that’s enough information to figure out the over all deal… I have my numbers, but I want to see if I’m accurate.
It doesn’t have to be an exact 100% figure since I may not have 100% of the info needed… but I’d like to get a really good idea if this was as good a deal as I suspect.
Oh, BTW – Zillow has the property listed for $280,000 (but the low is $204,000 and the high is just over $300,000 but I don’t think zillow takes into account the MUC-1 zone and the MultiFamily)
Please let me know if I am missing any type of information.