I will be co teaching a training class today with Mindy Demain, our team leader of the Keller Willaims Realty Elk Grove market center on working with investors...does it pencil out?
Last summer we taught a similar class in our market center that was very well attended by agents....however, at that time are prices in the Elk Grove & Sacramento areas were not nearly so affordable. Prices have dropped since then and yet rents have remained the same. Currently I am working with several investors who want to buy homes in the area and are competing against other investors and first time home buyers. With prices so affordable and interest rates at an all time low, now is a great time for investors to be buying!
If you are interested in what we covered in our last class, check out Working With Investors. This will give you tips on why people should invest, how to find investor clients and other resources to work with investors.
Today, I'm going to cover what type of deals my investor clients have been finding in this current market.
Case 1 - 8759 El Toreador Way, Elk Grove
This is a 3 bedroom, 2 bathroom starter home with approx. 1080 square feet on a corner lot. 
It is an Elk Grove REO property. It was purchased for $100,000...with 20% down, the PITI payment is $600.20, while this home will rent for $1100 per month. Even when you add in utilities (sewer, water & garbage) at approx. $110 and property management at 8% or $88, you still have a positive cash flow of approx. $300 per month.
Ok, so this investor needed the $20,000 down plus closing costs of approximately $5,000. After closing he needed to replace carpet, paint interior, replace kitchen appliances at a cost of about $4,000. If he had put this $30,000 in a bank, what would his monthly income be? Not $300 I'm sure!
Case 2 - 7716 Elmsmere Court, Elk Grove
Another Elk Grove REO property - 3 bedroom, 2 bathroom starter home with approximately 1231 square feet on a cul de sac near neighborhood elementary and middle schools. This investor is purchasing this property for $148,000 and is putting 25% down, making the PITI payment approximately $815.00. This investor owns another investment property around the corner from this one, same size but busy street and the rent is $1250, so after utilities and property management costs you have a positive cash flow of about $200 per month.
Case 3 - 10621 Beclan Drive, Rancho Cordova
This is a bank owned property in Rancho Cordova...3 bedroom, 2 bathroom 
with over 1500 square feet. This home was on the market at $144,400, but my investor got it for $134,000. With 20% down, his PITI payment will be approximately $800.00 per month.. According to Zilpy.com, this home will rent for $1250 per month; after utilities and property management, there is about a $235 positive cash flow on this one.
Once we close escrow later this week, my client is going to go in with new carpet, fresh interior paint, new kitchen appliances, new lino in the bathrooms and kitchen and some yard cleanup in the backyard. This home also has an addition that he is going to turn into a family room. He then is thinking he will sell it as a lease option instead of doing just a straight rental on it as this will bring him additional monthly income.
For a great worksheet to use with your investor clients to calculate cash flow, etc., check out Millionaire Systems free Millionaire Investor free downloads.
If you are thinking of investing in the Sacramento area, NOW is the time. Don't wait until our prices start going up because inventory is shrinking. Join us for our FREE Investor BootCamp on June 6th in Elk Grove! For more information on our Investor BootCamp, go to www.SacramentoInvestorBootCamp.com.
LOOKING FOR FIXERS???? BANK OWNED LISTINGS????
Contact Lori Mode at (916) 405-5765
Make sure that you know about the bank owned/REO listings as soon as they come on the market. Sign up today to receive daily email notifications of the REO listings. Search all Sacramento homes here!
Lori Mode & Bruce Durham, Keller Williams Realty, Elk Grove
www.AllElkGroveHomes.com
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