Selecting A Suitable Property

On August 2, 2010, in Uncategorized, by David Monsour

Today we are going to meet the property that I plan to analyze.  It seems like an interesting building.  It has 2 – 2 bedroom apartments and a 2000 sq ft commercial space. 

I see a lot of potential here.  Being from Gettysburg I know that this particular commercial space hasn’t been vacant as long as I can remember, but as a by product of the economy it’s currently not occupied.  Another problem this property has is that all of the utilities are tied together.  As an investor this is not ideal.  My goal as an investor is to have a very good prediction of what my yearly bills are going to be.  As a landlord it’s very hard to regulate what a tenant uses for heat, electric, water, and sewer.  Also tenants will “not care” about what their using if it’s the landlords responsibility.  If I were to actually purchase this property seperating the utilites would be crucial to potential income.  We’ll tackle that later.  

The list price is 249,900.  The apartments would likely rent for 750/each and the store front would probably rent for 1000/mo (they are currently asking 1500).  These figures are somewhat conservative, but it’s important to use conservative numbers when deciding on an investment.  This way if you error, you error on the side of making more money not less. 

The next step will be to visit the property to check condition.  I will also be making phone calls to the utility companies to find utility bills so I know what to expect for yearly expenses to be.  It is very important to confirm the figures provided by the seller.

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