Real Estate "investors" - scam artists!
Thread Starter
Joined: Oct 2000
Posts: 17,288
Likes: 39
From: Nashville
Real Estate "investors" - scam artists!
Maybe I am the dumbass....i can't imagine anyone falling for this......
This was in my local paper..... 11 properties "Great rate of return"..... go to this page for some pics and descriptions of the houses.
Link for Website here
Expenses per Joe Ward - notice that a couple of the houses (B) = Remodeling going on. New owners will need to do some work
He estimated way low on the maintance expenses (at least $1k per property), & vacancies (3%-5% annually) , then claims that Water Sewer & Trash is tenant paid ($70/mo per property...generally that is landlord paid) and then he amortized the loans at 5.5% at 30 years....(you can't get 5.5% fixed loans for 30 years with 95% financiing on any rental property)....
Magic Rate of Return.
Some dumb dick will fall for this guys "magic rate of return" and buy these slums for $745k somehow...... then wonder why they have to claim bankruptcy in about 6 months.
This was in my local paper..... 11 properties "Great rate of return"..... go to this page for some pics and descriptions of the houses.
Link for Website here
Expenses per Joe Ward - notice that a couple of the houses (B) = Remodeling going on. New owners will need to do some work
He estimated way low on the maintance expenses (at least $1k per property), & vacancies (3%-5% annually) , then claims that Water Sewer & Trash is tenant paid ($70/mo per property...generally that is landlord paid) and then he amortized the loans at 5.5% at 30 years....(you can't get 5.5% fixed loans for 30 years with 95% financiing on any rental property)....
Magic Rate of Return.
Some dumb dick will fall for this guys "magic rate of return" and buy these slums for $745k somehow...... then wonder why they have to claim bankruptcy in about 6 months.
Moderator
Joined: Sep 2004
Posts: 109,435
Likes: 1,651
From: SJC
I know nothing of the Harrisburg, PA market. If it were the Bay Area, getting an outhouse south of $100K is a steal. . . so. . . uhh, I don't know.
However, since this guy seems bent on selling these himself (rather than going through a realtor). . . that's a red flag. If these properties are such filthy lucre, why isn't he keeping them? There's another red flag.
However, since this guy seems bent on selling these himself (rather than going through a realtor). . . that's a red flag. If these properties are such filthy lucre, why isn't he keeping them? There's another red flag.
Registered User
Joined: Apr 2005
Posts: 80
Likes: 0
From: Northern Cal
Originally Posted by Scot,Aug 17 2005, 09:36 AM
and then he amortized the loans at 5.5% at 30 years....(you can't get 5.5% fixed loans for 30 years with 95% financiing on any rental property)....
Thread Starter
Joined: Oct 2000
Posts: 17,288
Likes: 39
From: Nashville
Originally Posted by jstrauch,Aug 17 2005, 04:24 PM
yes you can, I can get someone a 5.5 on a rental right now, fixed. You will just have to pay some points up front.
I think this guy has painted a pretty picture, but anyone who knows anything would notice he grossly underestimated all of the expenses and amort the loan over 30 years...doh!
Thread Starter
Joined: Oct 2000
Posts: 17,288
Likes: 39
From: Nashville
Originally Posted by happs22,Aug 18 2005, 01:00 AM
His estimated minimum rent for an $80,000 property is $1100/month? That rental cost seems a tad high to me.
I am amazed that someone could try to sell these shit-holes for so much and even more amazed when some dumbass actually signs up.
Registered User
Joined: Dec 2003
Posts: 1,774
Likes: 0
From: Irvine, SoCal
Originally Posted by happs22,Aug 17 2005, 11:00 PM
His estimated minimum rent for an $80,000 property is $1100/month? That rental cost seems a tad high to me.
Thread
Thread Starter
Forum
Replies
Last Post
LostWaffle
Money and Investing
50
Jul 29, 2008 11:32 AM