Without getting into a lot of detail and using typical development costs in my area (based on a new build) these are the approx numbers for a project my company completed last year in Indiana...
360 units
$2,150,000 @ 80% LTV = $1,720,000 loan
Expenses(mortagage, insurances, prop taxes, salaries, etc...)
$16,111 per month
$ 193,333 per year
Income (@ 100% occupied)
$31,700 per month
$380,400 per year
As you can see there is good profit potential. But obviously there are infinite factors (location, demographics, occupancy rate, # of units, full or part time employees, etc...) oh and not to mention you would need $430k to get approval for loan.
I realize these are rather large numbers but you can always scale this down for the projected size of your idea. Hope this helps.
I vote for the Starbucks! I am in SC rehabbing some SFH and coming from northern CA, I miss Starbucks! there are only three in the whole city of Columbia and two are in the same shopping center.
Is the property you are looking at in the Columbia area?
Long distance is harder. But it depends on the deal. I live in CA, but I bought properties in Texas because I can get cashflow there. In CA, it is next to impossible to get cashflow because of the high prices. I will take my chances in Texas. As of right now, I have a handyman that can handle most problems. If you can find a dependable and honest person who will work with you, I think you have a better chance. How often you frequent SC can have a bearing also. I know WA is in general more expensive than SC.
Well thank you very much for the info. everyone. I was actually talking about doing that for two personal loans. Closing on Loan 1 with bank 1, and then closing on Loan 2 with bank 2 a few days later.
So I guess the concensus is that this is still mortgage fraude with a high risk prison sentance...??
He is talking about personal loans. If no real estate is being collateralized, where is the mortgage fraud?
What was confusing he said that someone did it with mortgages, but he is thinking of doing it with personal loans.
I didnt think that it would be a problem with personal loans at all. Why does he need two separate loans, and is he further burying himself? Those are the questions. Everyone, especially with the economy now, feels the pinch, but gettng two separate loans for extra cash normally doesnt work out. Best bet, get a one loan thats more than enough to make ends meet.
Without getting into a lot of detail and using typical development costs in my area (based on a new build) these are the approx numbers for a project my company completed last year in Indiana...
360 units
$2,150,000 @ 80% LTV = $1,720,000 loan
Expenses(mortagage, insurances, prop taxes, salaries, etc...)
$16,111 per month
$ 193,333 per year
Income (@ 100% occupied)
$31,700 per month
$380,400 per year
As you can see there is good profit potential. But obviously there are infinite factors (location, demographics, occupancy rate, # of units, full or part time employees, etc...) oh and not to mention you would need $430k to get approval for loan.
I realize these are rather large numbers but you can always scale this down for the projected size of your idea. Hope this helps.
what in the neighborhood?
would a 1.50 dry-cleaner work?
Starbucks is a classic home run.
I vote for the Starbucks! I am in SC rehabbing some SFH and coming from northern CA, I miss Starbucks! there are only three in the whole city of Columbia and two are in the same shopping center.
Is the property you are looking at in the Columbia area?
Just one question. Why would you buy a property on the other side of the country on a first deal ? Long distance landlord is tough.
John
Long distance is harder. But it depends on the deal. I live in CA, but I bought properties in Texas because I can get cashflow there. In CA, it is next to impossible to get cashflow because of the high prices. I will take my chances in Texas. As of right now, I have a handyman that can handle most problems. If you can find a dependable and honest person who will work with you, I think you have a better chance. How often you frequent SC can have a bearing also. I know WA is in general more expensive than SC.
Does anyone have any thoughts about this?
thanks for the advice
Mortgage Fraud!!
Well thank you very much for the info. everyone. I was actually talking about doing that for two personal loans. Closing on Loan 1 with bank 1, and then closing on Loan 2 with bank 2 a few days later.
So I guess the concensus is that this is still mortgage fraude with a high risk prison sentance...??
He is talking about personal loans. If no real estate is being collateralized, where is the mortgage fraud?
What was confusing he said that someone did it with mortgages, but he is thinking of doing it with personal loans.
I didnt think that it would be a problem with personal loans at all. Why does he need two separate loans, and is he further burying himself? Those are the questions. Everyone, especially with the economy now, feels the pinch, but gettng two separate loans for extra cash normally doesnt work out. Best bet, get a one loan thats more than enough to make ends meet.