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Subject:  5 Unit Building Date:  1/28/2002  10:07 AM
Author:  Freeper Number:  1071 of 14287

35 yr old building w/ 5 units on 3 acres in a nice area.

Asking Price is $319,000

Roof = 7 yrs old
Well pump = 2 yrs
Pressure Tank = Original
Oil Heater = 3 yrs

Taxes = $5,000/yr
Insurance = $1,900/yr
Maintenance = $5,245/yr (elec $700, trash $545, sewer $1800, lawn $1700, misc $500, does not include snow removal)

Total Expenses = $12,152/yr = $1,012/month

Rents = $41,340/yr = $3445/month

Mortgage = It's a 5 unit building requiring a commercial loan. what kind of lending guidelines can i expect? it's in a great area and in great condition. I dont have the cash to put 20% down on this. The seller is trying to do a 1031 & mover to a warmer locale so he wont carry a mortgage.

Present owner claims 26 days of vacancies in 13 yrs (he's a realtor).

I dont think that there is a chance of hell in being able to afford the property but does anyone have any recommendations?

Cash flow #'s:

Assuming 100% LTV: PITI @ 7.5% @ 25 yrs = $2,357/month = $28,288/yr

Before tax cash flow is basically zero.

After tax is another story due to the high annual depreciation & interest writeoff:

Depreciation: (319,000*.66)*(1/27)*(.27) = ~$2,100
Interest: 319,000*.075*.27 = ~$6450/yr (1st yr)

1) Does this deal look worth the trouble if it could be financed?
2) How do I finace it to make it worth the trouble?
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