Posted by Tim on August 26, 2004 at 16:24:28:
Are you looking at a 20 year payoff? How much appreciation are you anticipating? I couldn’t begin to tell you what the increase in equity would be worth.
I do know that I wouldn’t trade 40 hours out of my month for $800. I have a strong suspicion that you could find another property that would have an equal amount of appreciation & increase in equity without the time commitment.
Laundromat/Carwash, can it work? - Posted by Dennis
Posted by Dennis on August 23, 2004 at 16:29:24:
My inexperience in real estate and laundromats has provided motivation for me to post this inquiry. I would appreciate any and all feedback. Thank you.
I have some homework to do, but this is what I know:
2000 sq.ft. Building w/ well established Laundromat, Carwash, and Apartment.
6 top loaders (age? Good working condition and well maintained)
3 front loaders (age? Good working, well maint.)
6 Dryers (age? Good working, well maint.)
2 Showers
1 Car wash
1 1bdr Apartment (with current long term renter)
1 Storage shed
Approximately 2000 sq. ft. in all. Purchase includes real estate.
Location: Small town (pop 1000)
Demo: Patrons include town folk (older homes not wired for washers), and campers, hunters, fishermen, tourists.
Books: Owner has books and willing to share (public and private). Books support owners claims of 20% return.
Finance: Owner willing to take 20% down and will finance at 5% w/ balloon at 7 yrs.
Note: Income from apartment and storage will cover 63% monthly payment.
I am willing to do whatever homework is necessary, just not certain where to start. I am interested in making a good argument against the gut feeling I have that says this is a winner.
Thank you
Q
Re: Laundromat/Carwash, can it work? - Posted by Eli
Posted by Eli on August 23, 2004 at 17:18:30:
I have owned a laundromat, I know a little bit about them. I am interested in buying a car wash but I havent yet. What kind of Cash on Cash return is this giving with 20% down. Give us all some numbers and we will be avble to look at it closer.
Re: Laundromat/Carwash, can it work? - Posted by Dennis
Posted by Dennis on August 23, 2004 at 19:46:41:
Thank you Eli,
Price $100,000 with $20,000 (possibly 15,000) down. Ownwer will carry contract at 5% amort over 15yrs. Pmt will be approx. $650/mo.
According to books (and even last years tax forms) there is an approximate $800/mo (average) after expenses and debt service.
Time committment is approx. 10-20 hrs per week. Current owner sometimes hires out cleaning (6hrs/wk at 7.50 hr.)
Hpoe this helps. Thank you.
Re: Laundromat/Carwash, can it work? - Posted by Tim
Posted by Tim on August 26, 2004 at 09:36:05:
It looks to me like you would be buying a low paying JOB. A 10 hour per week time commitment with an $800/month payoff works out to $20/hour, if you have to put in 20 hours a week you can cut that in half. I couldn’t see myself paying $15-20,000 for the privilege of working part time for 10-20 hours a week. Do the expenses show any sort of reserve fund contribution for major repairs? If they don’t then your hourly pay just got lower.
Re: Laundromat/Carwash, can it work? - Posted by Dennis
Posted by Dennis on August 26, 2004 at 10:15:27:
Thanks Tim,
Are you considering the equity build up in your figures? Wouldn’t that be worth something? Also, I was wrong about my time committment. It is more like 7-12 hrs per week. My wife and I would run the place together. Wouldn,t my $15-20,000 be doing better than sitting in a savings or CD?
Thanks again, Dennis