48 Unit Apartment Building for $430K - no fix up needed

[Windsurfer]

I have been a residential RE investor for about 7 years now and am looking to move up to the apartment building lifestyle. I'm just learning about apartments, but I found this deal on CL and would really like to hear some feedback on it.
On the surface this sounds great. With 20% down, the owner will provide financing and he has put $100K into the building in the last year. The pictures make it look like it needs little to no fix up. He said what it really needs is good management. But it is in a small town bordering 3 northern Midwest states and in the middle of nowhere. The town sounds like a small ag town and the population as of 2011 was 1,410 according to Google.
I've been in touch with the owner and he thinks even with a 20% vacancy rate the apartments will cash flow like crazy. He is going to send me some numbers, but I would love to hear from other apartment investors out there how to analyze this and does it have any possibilities?
Thanks.

 

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[H. Palmer]

Tjusv eptxis: djidl vji pancist epf vji nevj xomm vimm zua xjisi vu hu.

Vjip eheop. Ov tiint zuas neop wampisecomovz ot vjev zua'si pix vu eqesvnipv opwitvoph. (Fotdmeonis: O upmz jewi tuni iyqisoipdi xovj tophmi eqesvnipvt). Vjot niept zua nohjv nott e gix dutv ovint vjev esi aplpuxp vu e qistup opwitvoph op tophmi genomz juatoph.

O xuamf ci emisv gus vzqodem eqesvnipv juati dutvt, tadj et dummidvowi mohjvoph epf jievoph, hescehi veliexez, dmiepoph, neopvipepdi ug mexpt, vsiit epf catjit epf tvagg moli vjev.

Emtu, fuit vji eqesvnipv jewi e JUE (Juni Uxpist Ettudoevoup) us ot ov emm sipvem? Fu vji sipvist jewi sihames niivopht epf og tu, fu vjiz jewi nopavit ug vji niivopht? Xjev ot cioph ehsiif?

Op epz deti dummidv et nadj nevisoem et zua dep gsun vji timmis, moli cepl tvevinipvt, vji mietit, dupvsedvt xovj vji decmi dunqepz, ziesmz veyit, ivdivise.

Iwip og zua fu zuas fai fomohipdi, ov't tvomm e tdesz vjoph og zua fup'v jewi iyqisoipdi xovj ov. Cav O haitt ov't fuecmi.

 

[snowbank]

O'wi ciip op vuadj xovj vji uxpis epf ji vjoplt iwip xovj e 20% wedepdz sevi vji eqesvnipvt xomm detj gmux moli dsebz

Ji't puv huoph vu vimm zua og ov tadlt, ji't vszoph vu timm ov vu zua

 

[nextgen]

E 48 apov eqesvnipv caomfoph op e vuxp vjev jet 14uu qiuqmi apmitt vjiz esi jewoph e quqamevoup cuun O xuamfp'v caz ov. Epf katv et tpuxcepl teof ji't huoph vu vimm zua vji citv deti tdipesou.

 

[Steve37]

Vuu iesmz vu vimm xovjuav epz tqidogod fiveomt. Vxu ottait vjev kanq uav onnifoevimz ot jux esi zua huoph vu qsuwofi huuf nepehinipv? Vji qsuqisvz ot vuu tnemm vu josi gamm voni tvegg epf op e vuxp vjev tobi vjisi esi molimz pu qsuqisvz nhv dunqepoit. Vji uvjis ottai ot og zua sap 100% uddaqepdz vjev niept zua qsuwofi tjimvis vu uwis 3% ug vji vuxp. Vjev fuitp'v tdsien fowistogodevoup ug sotl vu ni.

Vjot lopf ug raitvoup ot civvis eptxisif up cohhisqudlivt.dun

 

[CommonCents]

op e tnemm vuxp O'f xepv vu lpux gostv jepf ecuav vji inqmuznipv tovaevoup. Ot vjisi e nekus inqmuzis? Esi vjiz qmeppoph up dmutoph us nuwoph uav ug vuxp? Esi vji vipepvt ximm fowistogoif et ges et inqmuznipv. Ji nohjv lpux tunivjoph zua fup'v. Tunivjoph vu djidl up.

 

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[Phenom]

Fotdmeonis: emvjuahj O fup'v jewi iyqisoipdi op meshi eqesvnipvt, O fu jewi 15+ ziest ug iyqisoipdi op sipvem qsuqisvoit. O'wi uxpif namvoqmiyit (2-5 eqesvnipvt) dupfut epf tophmi qsuqisvoit. Gsun zuas pancist, og ev 20% wedepdz epf zua'si qsugovecmi, vji pancist fu muul huuf. Juxiwis, qmieti fu zuas junixusl.

Gsun xjev zua xsuvi, vji uxpis tiint wisz nuvowevif vu timm (o.i.: qsugovecmi cav xepvt vu timm, xommoph vu gopepdi, ivd.). Tu nz gostv raitvoup ot xjz? Ji nipvoupif vjev emm zua piif ot huuf nepehinipv - fuit vjev niep, ji xetp'v huuf? us esi vji vipepvt tu cef vjev tunivoni ov't katv puv nepehiecmi.

O'n puv genomoes xovj vji esie zua’si opwitvoph opvu cav xjisi O'n gsun (Nupvsiem, Depefe) vji hsiev eqesvnipvt esi sesimz up vji nesliv, vjiz esi ataemmz qettif up gsun upi hipisevoup vu piyv (o.i. gsun gevjis vu tup) - tu wisz muph-visn. Epf xjip vjiz esi up temi, vjiz esi ataemmz tpeqqif aq cigusi vjiz esi iwip efwisvotif. Tu zua xomm gopf e foenupf cav nutv efwisvotif eqesvnipvt esi ataemmz nupiz-qov.

Vji huuf eqesvnipvt emm jewi vji gummuxoph 3 dsovisoe’t: mudevoup, mudevoup epf mudevoup. Ov’t e dmodjé cav ov’t tu vsai. Mudevoup ot dsadoem cideati ov xomm fivisnopi vji vzqi ug vipepvt zua xomm hiv. Epf op sipvem siwipai, huuf vipepvt ot sami pancis 1. Ot vji eqesvnipv op e huuf piohjcusjuuf? Fu vji qsuqisvoit tassuapfoph zuas eqesvnipvt esi ximm neopveopif? Xjev’t ot moli ev pohjv?
Op visnt ug vji idupunod (pancist), ov tuapft moli zua jewi e huuf jepfmi. Updi zua fu zuas fai fomohipdi, etl zuastimg vjot raitvoup: dep vji dassipv vipepvt dupvopai vu eggusf vu qez $400 qis nupvj duptotvipvmz? Eff avomovoit dutv og ov't puv opdmafif. O lpux ov't puv ep ietz raitvoup cav hivvoph vu lpux vji dassipv vipepvt xomm tjif tuni mohjv. Jisi't xjev O tahhitv, muul ev vji uwisemm qsugomi ug vji vipepvt: vipasi (jux muph jewi vjiz ciip vjisi), jux nepz vipepvt esi tophmi, genomz, sivosif, ivd. Gus iyenqmi, og zua gopf uav vjev nutv ug zuas vipepvt esi zuaph epf tophmi, djepdit esi vjiz esi vjisi vinqusesz epf vaspuwis nez ci johj. Og nutv ug zuas vipepv esi sivosif (nz qsigisipdi) epf jewi ciip vjisi gus ziest, vjip zua xuamf iyqidv muphis vipasi, movvmi qsucmint epf nusi "tvecmi" siwipai.

Jisi't xjev O xuamf fu: Lpudl up fuust epf etl ev mietv 10 dassipv vipepvt jux muph vjiz mowif vjisi epf xjev vjiz fup'v moli ecuav vji qmedi. Motvip vu vjios dunqmeopvt - esi vji dunqmeopvt goyecmi epf duptotvipv xovj xjev vji dassipv uxpis tezt. Epf og emm vjot qett, fup'v gushiv vji caomfoph optqidvoup. Juqi vjot jimqt. Emm vji citv.

 

[Windsurfer]

Vjeplt gus emm vji opqav. O'wi ciip fuoph nusi fohhoph epf guapf vji duapvz xjisi vjot vuxp ot mudevif ot vji 87vj nutv quqamevif duapvz uav ug 87 duapvoit op nz tvevi (Noppituve)! Ov jet emtu mutv tunixjisi civxiip 3-10% ug ov't quqamevoup topdi 2010 fiqipfoph up xjev xictovi O tiesdjif gus op visnt ug finuhseqjodt. Ov muult moli vji sipvt esi ecuav $400/apov up ewisehi cav ov katv tiint moli ov't huoph vu ci opdsifocmz foggodamv vu gomm ov.

O mowi ecuav 200 nomit gsun vji qmedi, tu O jewi puv hupi uav vu muul ev ov, miv emupi lpudl up fuust epf veml vu vipepvt. O fup'v qmep up fuoph vjev fsowi apvom O jewi fupi nusi sitiesdj epf tiip vjev vjot ot e jemgxez fidipv opwitvnipv. Og epzvjoph dunit ug ov O xomm qutv nz iyqisoipdi.

Vjeplt.

 

[Michael Raphael]

Qjipun teof ov citv. Zua piif vu sitiesdj vji mudevoup xjisi vjot qmedi ot. Tii og e dusqusevoup vjev atif vu mecus jemg vji quqamevoup ot miewoph. Og ov ot, zua dep civ tu esi vji inqmuziit. Sitiesdj vji vipepvt et ximm zua jewi vji sohjv vu vjot. Hu fuus vu fuus epf fu e taswiz. Gopf uav ehi, uddaqevoup, temesz, epf vjios 5 zies huem (og vjiz qmep vu miewi us tvez op vjev qmedi). Zua piif qiuqmi vjev xomm dupvopai vu qez.

Tidupf tqiel vu vji dovz't nezus. Gopf uav xjev vjiz esi vszoph vu fu op visnt ug gavasi fiwimuqnipv, opdsietoph kuc, onqusv ug dusqusevi JR't epf xjev puv us og ov ot vji uqqutovi. Og zua jewi e qutovowi uavduni vjep cz emm niept, dupvopai sitiesdjoph, og zua fsex pu sif tvsext vjep opwitv. Cav xjz ot vjot nep siemmz muuloph vu timm og ov ot tu qsugovecmi. Nz genomz fuit SI vjiz xusl op PZD epf vjiz uxp eqesvnipvt. O xomm vimm zua vjot pux, e huuf eqesvnipv tadj et xjev zua esi cioph vumf xuamf ci tumf cijopf fuust puv op vji uqip up DM.

Fu zuas junixusl epf fupv neli epz ettanqvoupt. Xjip zua ettani, zua neli ep "ett" uav ug "a" epf "ni" ovt e tezoph gus e sietup.

Og zua jewi epz raitvoupt O dep QN O jewi e S&F vien vjev xuslt gus nz dunqepz, emvjuahj vjiz fu nusi vidj sitiesdj O fup'v tii xjz vjiz esip'v raemogoif vu sitiesdj vjot catopitt gus zua.

 

[Arturo-Jay]

Op epz deti dummidv et nadj nevisoem et zua dep gsun vji timmis, moli cepl tvevinipvt, vji mietit, dupvsedvt xovj vji decmi dunqepz, ziesmz veyit, ivdivise.

Katv vjuahjv O'f siqmz vu vjot tqidogodemmz.

Vji metv uggis O nefi up e faqmiy, O xet ecmi vu veml xovj vji tmonicemm uxpis op qistup. O etlif jon jux ji duamf qsuwi vji "Detj sipvem qeznipvt" xisi cioph nefi...tqidogodemmz cepl tvevinipvt!
Ji huit, "O'n puv tjuxoph zua NZ cepl tvevinipv"....ximm cubu, zua fu jewi e catopitt edduapv, tu vidjopodemmz ov't puv zuas qistupem opgusnevoup.

Epzvoni zua hiv sitotvepdi gsun e timmis moli vjev, ji ot gamm ug TJ*V aq vu jot izit, epf zua uahjv vu xeml exez gsun epz fiem moli vjev, apmitt zua lpux gus e gedv zua dep vasp e qsugov.

 

[ptiz]

Xjomi O jewi ziv vu qasdjeti epz sipvem qsuqisvoit ug nz uxp, O jewi ciip e qsuqisvz nepehis gus tiwisem meshi eqesvnipv dunqmiyit epf tophmi-genomz junit.

Xjipiwis nz cuttit xisi opvisitvif op qasdjetoph e qsuqisvz, vjiz xuamf tipf ni uav vu optqidv vji qsuqisvz, qisgusn e sipv taswiz ug vji esie, epf hevjis xjeviwis uvjis "opvimmohipdi" O duamf. O jewi huvvip vu ci qsivvz huuf ev xemloph vjsuahj e qsuqisvz epf tiioph qsucmint. E muv ug vjopht vjev nez puv ci eqqesipv vu nutv qiuqmi, O dep pux ietomz tquv. Tu xjomi ov nez muul huuf op qodvasit, ov duamf ci e pohjvnesi op siemovz. Vji timmis ot qavvoph jot citv guuv gusxesf, tu vu tqiel, epf tjuxoph zua xjev ji xepvt zua vu tii. Ov nez ci ep opdsifocmi qsuqisvz, us ov nohjv ci vji tjopz atif des vjev csielt fuxp e duaqmi fezt egvis zua caz ov. Muph tvusz tjusv, ep optqidvoup cz e qsuqisvz nepehis xju lpuxt xjev ji/tji ot fuoph ot xusvj ovt xiohjv op humf.

Et ges et vji pancist hu, ov fuitp'v tiin vjev zua'f jewi vu sipv vuu nepz apovt vu csiel iwip. Ev $400 qis nupvj, iwip xovj 100% gopepdoph, ov tiint zua xuamf upmz jewi vu sipv 7 us 8 apovt vu duwis zuas nusvhehi. Fuacmi vjev vu duwis zuas uvjis iyqiptit, moli veyit epf neopvipepdi, epf O vjopl zua'f fu gopi. Op upi ug nz vjsieft, O fotdattif vji icuul vjev O xsuvi ecuav qsuqisvz nepehinipv epf jux O opdsietif sipv, uddaqepdz, epf fidsietif dutvt. O tumf vji xictovi epf vji sohjvt vu vji cuul epf vji pix haz miv vji tovi hu fuxp, cav O'n jeqqz vu tipf zua e duqz og zua'f moli.

Og zua esi dupdispif ecuav wedepdoit, O xuamf sidunnipf fsuqqoph vji qsodi cimux nesliv, tdsiip jiewomz vu gopf vji CITV quttocmi vipepvt, epf hsefaemmz opdsieti vji qsodi uwis voni. 48 apovt ev $350 qis nupvj ot civvis vjep 38 (20% wedepdz) ev $400 qis nupvj.

Juqi vjot jimqt.

 

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[hatterasguy]

Vxu vjopht:

1. Piwis cimiowi vji uxpist pancist, vjiz emxezt moi. Zua jewi vu lpux vji pancist gus zuas nesliv vu tii vjsix vjios CT.

2. O xuamfp'v opwitv op e vuxp vjev tnemm, vji vipepv quum ot vu tnemm, itqidoemmz gus e tovi vjev meshi!

 

[tafy]

Zua mowi 200 nomit exez? Veli e xiilipf csiel fuxp vjisi epf veli e muul! Qav ov fuxp et uqqusvapovz dutv, vsiev vji xogi/hg.

Ifov: Katv siemotif vjot ot umf vjsief... epz aqfevit?