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In the area I live in, its full of extreme low income families. My parents own 44 rentals (apartments, trailers, houses) and one commercial building. I've noticed on facebook, along with the unrealistic amount of phone calls, and voice mails my mom gets about people looking for places to rent.

My parents recently bought 52 acres ~5 miles from i85, and walking distance to the school, he had a buyer for 2 acres (Dollar General $185,000 for 2 acres but they got the quote on how much it was going to be to for them to rent a build and it was way to high, so they said they would stay in contact but no ones heard from then in 2 month oh well)

So I proposed the idea of my younger brother, myself, along with my parents going in together and building 20-30 units. 2 bedrooms 2 or 1.5 baths. Parents were all for it. Brother was not to excited about it.

My parents told me to run numbers, and get a rough cost on, building, interest rates, income, and expense.
(I do not have the numbers I came up with, but I did inflate all numbers to cover my ass.)

Rent in the area is between $600-$700.00/month (normally no one gets $700.)

After doing some the rough calculations, I came up with not to happy of a number.

$35,000.00 (Im going off memory here so this maybe incorrect as well...)

That is what we would have left over at the end of the year. BEFORE property taxes, insurance, and misc. repairs (**** breaks) Of course no one in the group would receive any money until it was paid for. From the numbers I have came up with it would cost us every year to own them rather then them make their on way.

So the question is, has anyone looked into build multiple apartments at once? If yes, did you? or not? Is it worth my time to call the banks or even thinking about it anymore?

Granted not one bank is going to give someone my age this large of amount of money.

Not to sound arrogant or like an asshole. But I do realize that the stuff my parents do own will be split between me and my brother (reason I know this is 1. They have told us several times 2. I was there when they wrote and signed the will), but the way I see it is, why not go ahead and start growing it even bigger.
 

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PSN alphadong11
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Here is one the company I work for is doing. You can do a rough divide cost per unit but he might be throwing in amenities that you won't have. Haven't even read the article yet.
 

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Here is one the company I work for is doing. You can do a rough divide cost per unit but he might be throwing in amenities that you won't have. Haven't even read the article yet.
You got a link?
 

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PSN alphadong11
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Discussion Starter #5
First thing I noticed was $220 MILLION
 

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PSN alphadong11
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Yeah but land parking retail and 675 units with 100 units for seniors. Not sure if that's going to be 775 units total or 575 then 100 for seniors. Im just skimming at work between calls

---------- Post added at 02:44 PM ---------- Previous post was at 02:42 PM ----------

Also we have in house construction so once the foundation is poured our guys start the framing and do mostly everything after that except for stuff like every ac install and stone work
 

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Discussion Starter #7
Yeah but land parking retail and 675 units with 100 units for seniors. Not sure if that's going to be 775 units total or 575 then 100 for seniors. Im just skimming at work between calls

---------- Post added at 02:44 PM ---------- Previous post was at 02:42 PM ----------

Also we have in house construction so once the foundation is poured our guys start the framing and do mostly everything after that except for stuff like every ac install and stone work
Either way that is a lot. The boss man you got must really know what he is doing!
 

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PSN alphadong11
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Lulz can't read editf. I'm not really on the development side but you said you already had the land, does it have utilities already ran to the property or will that have to stubbed in?

---------- Post added at 04:55 PM ---------- Previous post was at 04:51 PM ----------

Ahh decimal not a comma lol

---------- Post added at 04:58 PM ---------- Previous post was at 04:55 PM ----------

Did you go by cap rate?
 

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Discussion Starter #9
Lulz can't read editf. I'm not really on the development side but you said you already had the land, does it have utilities already ran to the property or will that have to stubbed in?

---------- Post added at 04:55 PM ---------- Previous post was at 04:51 PM ----------

Ahh decimal not a comma lol

---------- Post added at 04:58 PM ---------- Previous post was at 04:55 PM ----------

Did you go by cap rate?
We have been clearing it for the past couple month on the side, so it has nothing on it. and on the cap rate yes and no. We want it to make its way.
 

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I will tell you from my business ventures there is a strong correlation between registered vehicles and average income in an area. Registered vehicles means people drive to work, what they make is next. If there are not 100k registered vehicles with average income of XYZ within a certain mile map it usually isn't much interest on my end, or a banks lending end. Banks want to know all kinds of details like that.
 

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Discussion Starter #11
I will tell you from my business ventures there is a strong correlation between registered vehicles and average income in an area. Registered vehicles means people drive to work, what they make is next. If there are not 100k registered vehicles with average income of XYZ within a certain mile map it usually isn't much interest on my end, or a banks lending end. Banks want to know all kinds of details like that.
That makes a lot of sense. I would not want to loan out a large amount of money just to have the place flop and me lose it all. But with no risk no reward.

A quick google search shows we had

18,500 people in the county in 2013
Average income being $20,000-$40,000.00 for 2015
~93% of the population being white
~7,500 Housing Units
Average House costing $121,000.00

The county is growing ROUGHLY 200 people per year.
 

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PSN alphadong11
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What about storage containers turned into apartments? Are you close to any sea ports? It would take roughly 3 40 foot shipping containers for 800 sq feet. Would save a lot on labor as far as framing, and exterior building. I would still pour a pad and have the plumbing done and sewer stubbed, then bring in the container on top of it. I think it would be pretty cool to see an 8 plex built out of them. Or how ever high the city would let you stack them. Have an idea how many levels you can go up, then have some plans drawn to see the maximum amount of units you can fit on your land and use up all the space you can. Have one small corner that you can go 4 high on? 4 Studio containers stacked lol. Then go in phases. Don't build it all at once.
 

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The cost to build these units is the biggest factor,and you need to narrow that down and find other apartment complexes you want to model. If you could build 30 units for 2 Million and rent for $700/mo each, a 20 year loan would cost 14K/mo and you would be brining in 21k in rent, leaving 7k left over. Thats roughly 85k a year before taxes and upkeep, not including equity. Including regaining equity and income, your looking closer to 200k per year.

How did you get your 35,000 number? Also getting a loan is alot easier as a business, I'm guessing your folks have an LLC they use for their rentals, and I would take advantage of this when trying to get a loan.
 

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Discussion Starter #14
The cost to build these units is the biggest factor,and you need to narrow that down and find other apartment complexes you want to model. If you could build 30 units for 2 Million and rent for $700/mo each, a 20 year loan would cost 14K/mo and you would be brining in 21k in rent, leaving 7k left over. Thats roughly 85k a year before taxes and upkeep, not including equity. Including regaining equity and income, your looking closer to 200k per year.

How did you get your 35,000 number? Also getting a loan is alot easier as a business, I'm guessing your folks have an LLC they use for their rentals, and I would take advantage of this when trying to get a loan.
Okay, I just roughly did some numbers $35,000 was WAYYYYY off.

These are quick numbers.

1,537 sq/ft (768.5 sq/ft 2 bed 1 bath)
(x)
$75.00 sq/ft
____________
$115,275.00 (Per Duplex)
(x)
15 Duplex's (30 Apartments)
____________
$1,729,125.00 (Total Loan Amount)

(4.5% Interest rate)

$8,761.00 Monthly Payment ($262,830.00 Yearly Payment)
($3,154,040.00 Total Cost)

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

$600.00 Rent ($7,200 yearly rent)
$216,000.00 (Total Yearly Income)

$650.00 Rent ($7,800 Yearly Rent)
$234,000.00 (Total Yearly Rent 15 Units)

No way we could get any more on rent unless we had just super desperate people, we would need to be around $800 to have $20,000 at the end of the year, I would say property taxes are around ~$13,000-$15,000 yearly based off my parents 26 apartment complex they currently own.

I have no clue what the interest rate would be, the 4.5% is a complete guess.
 

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PSN alphadong11
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I can't believe your rent is that cheap. Might as well go section 8. Our sheet is one bedroom with garage 930 a month. But we are gated/pool/fitness center.

You can do section 8 vouchers where the people come up with part of the rent and the gov pays the rest. It's not full section 8 and more common for 55 and older. So they might pay $500 a month but then the government brings in the other $400. There are limits to that though on the amount you can charge and each makeready has to pass sec 8 inspection.

---------- Post added at 02:57 PM ---------- Previous post was at 02:56 PM ----------

If you have a large number of aging people downsizing for retirement that could be an option too.

---------- Post added at 03:00 PM ---------- Previous post was at 02:57 PM ----------

https://portal.hud.gov/hudportal/HUD?src=/topics/housing_choice_voucher_program_section_8
 

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Discussion Starter #16
I can't believe your rent is that cheap. Might as well go section 8. Our sheet is one bedroom with garage 930 a month. But we are gated/pool/fitness center.

You can do section 8 vouchers where the people come up with part of the rent and the gov pays the rest. It's not full section 8 and more common for 55 and older. So they might pay $500 a month but then the government brings in the other $400. There are limits to that though on the amount you can charge and each makeready has to pass sec 8 inspection.

---------- Post added at 02:57 PM ---------- Previous post was at 02:56 PM ----------

If you have a large number of aging people downsizing for retirement that could be an option too.

---------- Post added at 03:00 PM ---------- Previous post was at 02:57 PM ----------

https://portal.hud.gov/hudportal/HUD?src=/topics/housing_choice_voucher_program_section_8
I can promise you, once a renter leaves, or a new unit is purchased, I would personally have no problem moving into the.

As far as Section 8, do I still have my right to say no to them renting, is it possible to evict them if they do not pay their rent, or causing damage?

---------- Post added at 04:23 PM ---------- Previous post was at 04:18 PM ----------

Never mind. Its basically the exact same as renting to anyone else, honestly a pretty sweet deal, but you do have to be approved first.
 

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PSN alphadong11
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You don't have the right to refuse housing past like 4 units orsumthinlikethat. Section 8 or not. If they qualify you have to rent to them. Now if they have a terrible rental history, felonies, evictions on the background check then I believe you can deny them. I don't do front office work so I don't know all that.

Only certain kinds of discrimination, such as that based on race, ethnicity, religion, family status and disability are recognized as illegal. Many states and some localities have added others -- such as gender and sexual orientation -- but convicted felons are not now on any state's list. (Under federal law, however, it is illegal for a landlord to discriminate against a tenant who has a felony conviction for drug use -- but a landlord can discriminate against someone with a felony record for drug sale or manufacture.)
 

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don't bring those poor, dirty, section 8 super predators around here
 

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missippi roolz
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I can't believe your rent is that cheap. Might as well go section 8. Our sheet is one bedroom with garage 930 a month. But we are gated/pool/fitness center.
Gahdamn, $930/month for a single bedroom with garage? I would be ****ing rich with how much money I'd be saving.

This is what that kind of money gets you in Seattle:


Yes, you are looking at the entire "apartment".
 

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what the **** lol

i rented out my finished basement a few years ago. that included two huge rooms, one smaller room, another big room that has the water heater/washer/dryer/work bench/etc., a full bath, and two closets for $300/mo.

i'm actually thinking about living in my own basement and renting out the two upper floors. the tenant would get a high ceiling den, dining room, kitchen, 4 bedrooms, 2 bathrooms, 2 closets plus a walk-in closet, a big front porch and back porch/outdoor hot tub that they'd have access to, and maybe one of my car port stalls. i'd be very very happy to get $800/mo
 
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