Current Progress on a Property in Dayton OH

I often get asked about what I do at a more detailed level - so I thought it would be good to show an example.
It's funny when I explain deals to people who think differently. Some people love numbers and others don't. One of my friends Matt loves them (we affectionately nickname him Rain Man). Other people are visual and it's all about the look of a house and how it's transformed. Others are very much emotional, it's about how investing makes them feel and how it makes a difference to the community. So I'll put a few of these items into the progress report.

Remember I am a value investor, so it is all about value. I identify value in terms of equity and also cash flow. We focus on purchasing property at a steep discount to the true value of the property and we also look for deals that provide a very generous cash flow in a safe neighborhood.

This property was purchased in Ohio from a bank who had foreclosed on the property, taken possession of it and sold it to us to clear their books of the bad debt (banks need to reserve more capital against bad debts, and this reduces the amount of money they can then loan out).

1. Purchase Price: $38,000
2. Repair Costs: $18,000
3. Total Cost: $56,000
4. After Repair Value (ARV): $85,000
5. Loan to Value (LTV): 66%
6. Monthly Rent: $1,000 (21.4% gross return p.a)
7. Operating Expenses Estimate: 7%
8. Value Summary: Created $29,000 of equity (51% ROI) and a gross cashflow of greater than 20% per annum.

​

​There are some great stories that go with each property. Here is a few from this property:

• This vacant home for more than 2 years was now being improved - much to the neighbors delight (no one likes living next to a vacant home, it attracts the unsavory types)
• Many rentals in the area are not improved with new kitchen appliances, new bathrooms and updated finishes. So this property stands out.
• We were taken aback by the interest in the property - more than 100 people showed interest to rent the home from us! My realtor had to take down the listing after 2 days on the market! 
• There is amazing interest from that community to be able to lease a newly improved home and also have the opportunity to purchase it from us with owner finance.
• The tenants have very good credit and very stable jobs. Once they purchase the property from us, their monthly repayments will be less than the monthly rent they pay. It will go from $1,000 per month to less than $900 per month.
• Statistically, home owners take better care of the house than tenants, so it will likely improve the neighborhood street-scape even more, and potentially improve house values with it.
• My private lender on this deal is in the mean time, investing in a secure first position loan (as the bank) with a Loan to Value of 66% and obtaining a generous cashflow of 8% paid quarterly. This return is much better than the current rate in the bank of less than 2% 

It's a typical deal that we at Asher Management are delivering on. 
If you'd like to know more, or are interested in these types of deals, reach out to me. I'd be very happy to share more information.