Real Estate Investment Thread

The previous owner of our property management company is a guy who also owns more then 60 properties around OKC; he has been my mentor when it comes to evaluating properties and also assists with finding contractors when they need renovation. About 6 months ago he approached us with a few private bundled house offers from relatively large (20+) property owners. There was a particular lot of 4 houses that we were interested in but didn't know if we wanted to dive into 4 at once. They wanted $337,000 for all 4 and we knew that we would have to put down 25% because they are all investment properties plus whatever on each renovation. Fast forward to last month. We asked our guy if they had been sold and he said "no, but with the market how it is they might be looking to deal." We offered $301,000 for the lot, they countered at $311,000 so we had our guy go and look at the properties inside and out. He said that 3 are very well kept and would need $0 in reno but that the last one had clutter outside and was never around to let him inside. He said that if the outside is dirty than the inside will be as well and told us that he would tell them to drop it back down by $25,000. We did that and they countered again at a total price of $299,500 for the lot. We are going to accept conditional on a walkthrough of the final property to make sure it isn't too bad, but before inspections we are in a good spot to pick them up. Here is my quick chart on the expected P&L for the deal.




The funny part is that we are walking into a ton of equity on these houses based on the market value; we are just catching a great deal because it is a private sale that hasn't hit Zillow. Here is the day 1 equity outlook.



Not a bad deal.

OU Ariakas said:

The previous owner of our property management company is a guy who also owns more then 60 properties around OKC; he has been my mentor when it comes to evaluating properties and also assists with finding contractors when they need renovation. About 6 months ago he approached us with a few private bundled house offers from relatively large (20+) property owners. There was a particular lot of 4 houses that we were interested in but didn't know if we wanted to dive into 4 at once. They wanted $337,000 for all 4 and we knew that we would have to put down 25% because they are all investment properties plus whatever on each renovation. Fast forward to last month. We asked our guy if they had been sold and he said "no, but with the market how it is they might be looking to deal." We offered $301,000 for the lot, they countered at $311,000 so we had our guy go and look at the properties inside and out. He said that 3 are very well kept and would need $0 in reno but that the last one had clutter outside and was never around to let him inside. He said that if the outside is dirty than the inside will be as well and told us that he would tell them to drop it back down by $25,000. We did that and they countered again at a total price of $299,500 for the lot. We are going to accept conditional on a walkthrough of the final property to make sure it isn't too bad, but before inspections we are in a good spot to pick them up. Here is my quick chart on the expected P&L for the deal.

View attachment 490590


The funny part is that we are walking into a ton of equity on these houses based on the market value; we are just catching a great deal because it is a private sale that hasn't hit Zillow. Here is the day 1 equity outlook.

View attachment 490592

Not a bad deal.

Click to expand...

We closed on the 4 houses from the post above yesterday morning. The seller was pleased with how smoothly the process went with us. Here is the kicker, the seller has another bundle of 8 properties that they are looking to offload and, just like the above, do not want to split them up. We were thinking of making an offer on them so I went digging onto Redfin and Zillow to try and find out how much they paid for each of those properties so that I could find out if we were equipped to make a reasonable middle ground offer. I could not find much info so I went straight to the county assessor's site and found that they purchased all 8 in bulk in 2016 for $610,000. I really, really want to just offer them something like $620,000 for the lot which would put us at less than $80k per property and right around 1% of rent on each one (all are rented right now). Their alternative is to try and sell each one individually with tenants which makes the process longer and harder because you cannot reliably sell to someone looking to be an owner/occupant. My reasoning is that they have benefitted for almost 8 years of rental income so maybe they would rather sell them painlessly to us at a wash to be done with them instead of trying to make a larger profit on each one and have it take years to accomplish.

Daidraco , your family owns mobile home parks, right? This one looks crazy profitable.


Freaking $750k for this:



What am I missing?