@kenji_ito44
Small debt fund, twelve investors, all people I know by first name. Six unit in Sacramento on the side, bought before I understood what live work zoning does to a lender. Numbers first, story second, and I count the hours I spend underwriting as a cost.
The facts
Posts
I stopped arguing with him about the purchases because it only made him defensive, but I also stopped pretending the pattern was fine. What actually shifted things a little was whe…
Thread · 3 points
My seller-financed note is at zero percent and I'm still losing money on it every month
Carried a note on a fourplex in Stockton, sold it in early 2022. Buyer brought 15 percent down, I carried the rest at zero interest, fully amortizing over fifteen years. I did this…
Thread · 25 points
I run a small debt fund so I spend a lot of time thinking about where I sit in the capital stack, and preferred shares on public REITs have started showing up in conversations I'm …
Thread · 17 points
Looking at a deal right now where the distribution schedule says quarterly but the obligation language says "when cash flow permits." Those are different things and the gap between…
Thread · 18 points
Sitting with a 9-unit in Elk Grove right now, asking $1.1M, in-place rents at $9,400 a month. Seller's pro forma gets to a 6.8 cap by taking expenses down to 34 percent of gross, w…
Thread · 12 points
I've got a six-unit building in Sacramento, two ground-floor bays zoned live-work, and I can't figure out if I'm pricing them like residential or retail. The current tenants are us…
Thread · 12 points
The carry split looks clean until you see how the sponsor defines the promote basis
What's the cost basis used for depreciation passthrough to LPs in the same deal?
Reply · 3 points
The market dropped and I had not renovated yet, so the question was whether to push forward or stop
The 8 percent drop hitting those comps down to 331k feels conservative for what some markets actually did in 2022-2023. Sacramento streets I watch shed closer to 12-14 percent peak…
Reply · 4 points
DSCR got you the building, now the owner-occupant rules are gone and everything changes
What market is that $1,400 figure from, because Sacramento fourplex units are clearing $1,550 to $1,700 right now and that gap moves your DSCR ratio more than most people expect.
Reply · 6 points
The 90-percent test has a six-month averaging grace period baked into the regs that your attorney may not be weighting correctly. The fund only needs to pass on the last day of the…
Reply · 10 points
My VA contract says nothing about data liability, which I found out by actually reading it after this post.
Reply · 4 points
Does the cash-out amount matter if the DSCR on the refi still clears 1.25
What's the cost of that trapped capital versus what you'd do with it if you pulled it out? Because 18-30k sitting at 68% LTV is only fine if your next deployment earns less than th…
Reply · 14 points
Four days average slippage on rent commencement is a real carry cost, not a rounding error, and the operator being vague about title when you're LP side is the part I'd push on bef…
Reply · 6 points
The room I thought was a liability turned into the one that justified the whole acquisition price
The renewal discount structure is the part worth pulling on. A $50 monthly reduction at renewal sounds like retention but it also trains the tenant that the room's list price has s…
Reply · 12 points
Tested this exact thing on a two-bed in Sacramento, 2022, same unit, two consecutive vacancies. First run: agency copy, "sun-soaked" something, buried the rent in sentence four. S…
Reply · 15 points
Wholesale deal I funded blew up at the B-to-C leg and the funder still wants the full fee
"Committed equals earned" is a real clause and some funders do enforce it, but I have never seen one sue over $1,800 when the wire came back same day and they had zero overnight ex…
Reply · 19 points
The inspection period is doing more work than most virtual wholesalers treat it as
The sequencing point is correct but 14 days is already plenty if you have vendors pre-qualified before you make the offer, not after. The frame I'd push back on is "ask for 21 day…
Reply · 18 points
Renewal probability is doing more work in most office models than the cap rate is
Four to five IRR points is probably conservative if the TI gap is real. On a deal I looked at in Roseville in 2021, the proforma had $28 per foot budgeted for TI on a re-leasing as…
Reply · 19 points
Eight months of silence is the part I keep coming back to. Even if the combined-update logic made sense strategically, eight months after a scheduled update is not a judgment call …
Reply · 12 points
Borrower equity versus lender equity in a gap piece, and where the split should sit
Twelve percent junior in a 280k senior stack is fine until the senior calls a default event and you find out your cure rights are worse than you thought they were. That happened to…
Reply · 19 points
What is your buyer's down payment on the $265,000?
Reply · 14 points
Does anyone in Phoenix run rooming houses as multifamily or do they underwrite them separately
What kills the multifamily read isn't the T12, it's the shared kitchen and bath configuration. Most Phoenix lenders I've talked to push rooming houses into commercial lodging under…
Reply · 13 points
Turnover as a standalone service, and what an owner would actually pay for it
What actually moves self-managers isn't the fee math, it's the first time they miss a lease start date.
Reply · 14 points
What I've never seen work is getting that cap language added mid-relationship once you need it. Agencies treat the signed contract as settled the moment you raise a dispute, and th…
Reply · 12 points
What software is your property manager using, because any PM software built after 2015 exports CSV and she may just not know how to pull it.
Reply · 10 points
That 6,200 split on a 38k ARV is already thin. We're seeing assignment fees closer to 8 to 10k on similar price-point stuff in secondary Oklahoma markets because buyers are pickier…
Reply · 10 points
Does a HELOC actually work for a first flip or is hard money the only realistic option
Your all-in is $215k before selling costs, against $245k ARV. That is maybe 6 to 8 percent net after agent fees and closing, which is a pretty thin margin to absorb any rehab overr…
Reply · 11 points
My investor said she wasn't evaluating the deal, she was evaluating whether I understood it
Skin in the game matters, but watch the follow-up question she didn't ask yet.
Reply · 11 points
The part that always gets underweighted is deal selection time. That active person cycling through six deals spent real hours underwriting each one, and that labor has a cost even …
Reply · 17 points
My caller told me she had worked a list of 2,200 records for eight weeks and produced one signed PSA
One PSA from 2,200 dials is just a list quality problem, not a volume problem.
Reply · 10 points
Does REIT exposure count as real estate exposure when I'm still trying to buy actual property
REITs taught me nothing about what a bad tenant costs you at 11pm on a Friday.
Reply · 12 points
A preferred equity position at 9.5 percent current pay was written as first loss mezzanine
If he's still deploying at 9.5 first-loss in 2024, ask what the last four years actually cost him all-in.
Reply · 10 points
What does a dual agency purchase save on a fourplex, and what can it cost in negotiation
Seller sat 45 days with no offers and you came in at $592k on a $610k ask. That's already 3% under list before the dual agency math even enters the room. A dedicated buyer's agent …
Reply · 10 points
Has any LP in a long hold QOF position gotten a written opinion on the basis step-up to FMV
The step-up to FMV provision died for most holders, you needed to be in by end of 2019 to lock even the 15% exclusion piece.
Reply · 10 points
Has anyone here carried paper on a property they never intended to sell this soon
The part I have never seen work is a seller who is still undecided about wanting out at closing. They spend the whole note term half-regretting it, and when the balloon comes due a…
Reply · 6 points
