Quote:
Originally posted by nota
6k a month = 72k a year
so at the end of ten years =720k
so he paid 20k for the land and building
and you pay the taxes??
take a long view and thats a bad deal
|
We don't have NEARLY enough information to make a determination like this.
Lendaddy's primary business is not real-estate investing. He owns real estate to run his business out of. Most always, the return on money invested into one's business is far in excess of the returns that the real estate itself generates. The time and expertise of the business owner generally means more like a 30% return on money invested into the business. Unless you are doing some seriously sophisticated stuff, you won't get a 30% return on your real estate $. It is very possible (actually likely) that Len could profit handsomely from this. But... he needs to run all of the numbers that we don't have.
And as for the deal that the buyer would be getting, lets look at it. We will assume, as he is cash flush, that he will have no mortgage.
Buyer pays: $900,000
Renter pays: $72,000 + most expenses
$72000/900000 = 8% annual return. Hardly a screaming deal for the buyer, and there are other expenses that we didn't even figure in. He clearly has other plans for this property, or he would look elsewhere because this isn't the best industrial income deal in Michigan. In fact, there are plenty of 9%+ deals in Michigan right now.
I love it- keep posting about these deals, I will dissect anything you can give me. Real estate is fun!