Sample Small Deal - Perfect for Investors with Self-Directed IRA
Property:
3-family property with some student housing in college town.
C+ property in a B area.
Town:
Smaller college town 20 minutes outside larger metropolitan area, population increasing at rate of 4%.
Rogue Solutions likes to invest in college towns because:
Deal Details:
Initial purchase price = $134,000, based on NOI of $14,700 and a CAP rate of 11
$ 33,500 = 25% down payment
$ 6,500 = closing costs
$100,500 = mortgage, amortized 30 years at 6.5%
3-family property with some student housing in college town.
C+ property in a B area.
Town:
Smaller college town 20 minutes outside larger metropolitan area, population increasing at rate of 4%.
Rogue Solutions likes to invest in college towns because:
- Unlike businesses, established colleges rarely close or move,
- Colleges provide stable employment,
- Colleges normally raise the price of their student housing anywhere from 1.5% - 4.5% per year, so off-campus rents can be raised as well,
- Students can get financial aid to cover the cost of their off-campus housing,
- Parents of undergraduate students can co-sign the lease.
Deal Details:
Initial purchase price = $134,000, based on NOI of $14,700 and a CAP rate of 11
$ 33,500 = 25% down payment
$ 6,500 = closing costs
$100,500 = mortgage, amortized 30 years at 6.5%
