Great Long Island investments today have good cash flow.
I saw this property this week and was very excited about it, for the
buyer investors I have been working with. It is a bank owned (REO) in Hempstead NY (on Long Island).
It s is 4
family consisting of 3- 2 Bedroom Apartments and 1- 1 bedroom
apartment. It needs considerable work. All 4 baths, all 4 kitchens,
some windows, as well as the stairs from the 1st floor hallway to
the second floor need fixing or replcing. Structurally the property
seems ok although I would definately have an engineer make sure.
Back to the numbers though. If the apartments are rented to tenants through the section 8 program the
rents for 2 bedroom apartments are approximately $1,400.00 US per
month. 1 Bedroom apartments can recieve up to $1,100.00 US per month.
That is a gross annual income of $62,400.00
US ($1,400.00 + $1,400.00 + $1,400.00 + $1,000.00 x 12 =
$62,400.00 US Dollars). The taxes are stated as $11,254.57. If
we assume the insurance is $1,200.00 , heat $3,000.00, and water
$1,000.00, per year the annual expenses are approximately $16,454.57
making the net operating income (NOI) a little less than $46,000.00 US Dollars.
The asking price on the
property is $229,900.00 USD. The property may need 50-60,000.00 in work
(you could easily put in more if you wanted to, but look at the
picture- it is not and never will be a luxury apartment). Lets figure
on some surprises and figure the total cost is $300,000.00 USD and that
is figuring purchasing at full asking price (remember it is bank owned
and banks are sometimes negotiable).
The capitolization rate on this property is 15%
I have spoken with one
investor who puts in electric heat for each apartment, making his
income go up and reducing the maintanance on an old boiler with the
bonus of reducing carbon emmissions (It’s a “Green” investment
property—WOW making money and saving ther earth).
If you have any questions about this property or any other investment property feel free to contact me at 516.984.0789 or e/m Reillyerik@aol.com
Erik Reilly
“Living a life I love, through service to others”