Posted by Carol on December 12, 2001 at 19:53:41:
Garth, your starting point is to learn the seller’s motivation. That will dictate your strategy in part. The rest in hypothetical.
Then, get your figures right - not guesswork.
Lastly, like any other deal (no matter the zero’s), make an offer that works for you, AND responds to the seller’s motivation.
Good luck,
carol
How To Make Money On Free And Clear Apartments - Posted by Garth (Florida)
Posted by Garth (Florida) on December 12, 2001 at 14:54:53:
I have a print out of some apartments that according to
the report have no mortgages on them.
What are some best ways to purchase free and clear with little or no money down and still have cash flow at the
end of the day?
Re: How To Make Money On Free And Clear Apartments - Posted by Ronald * Starr(in No CA)
Posted by Ronald * Starr(in No CA) on December 12, 2001 at 22:27:53:
Garth–(FL)-----------
Carol gave you good advice. If you want positive cash flow, work backward. Start with how much cash flow you want. Then add in the costs of holding the property, including a mortgage for the whole selling price. Subtract this total from the rental roll, reduced by a reasonable vacancy factor. If you have a negative number, your mortgage payment is too large. Reduce the purchace price and mortgage amount to reduce the mortgage payment. When you have a zero difference between the cash flow and the expenses plus profit, that is the maximum price you can buy at, at least with those rents, costs, and mortgage terms. Just be sure that you have really included all the expenses. If you have a “set-up” sheet from a broker, it may well leave out some expenses, such as reserve for major expenses. Sometimes they leave out taxes or insurance. It is incredible what you will see in set-up sheets.
Good Investing*******Ron Starr**************