4 Tips on How to Find Affordable Apartments

Are you looking for San Antonio apartments? Being new to the city, it may be hard for you to find a reasonably priced place to live. Even more so, if you do not know anyone who lives in the city, who can guide you. In order to find some affordable apartments, first, estimate the amount of money for your apartment rent budget. If you are on a tight budget, you might want to consider setting your apartment budget just about the average cost of most apartments. Canvassing the key to know if the apartment you have chosen is charging you at a lower or higher price.

Second, after knowing your budget for the apartment rent, choose the neighbourhood wherein you want to live. Of course you would definitely want to live in a community with low crime rate and easy access to transportation. However, it varies for every person. If you want to live near some wonderful sights in Texas, such as the River Walk, you should live downtown. When finding San Antonio apartments for rent, you should choose the right apartment that is suitable for your lifestyle.

Next, after choosing the right spot for your apartment, you should browse for sites that provide information about San Antonio Texas apartments. Through the Internet, you will be able to see the various apartments for rent. In addition, you will be able to read the apartment reviews written by other residents. This is essential in order for you to know if the San Antonio Texas apartments are worth your time and money.

Online sites on this apartments for rent are also very beneficial, because they do not only give you details with convenience, but they also save enough money and time. Imagine travelling to this is for hours, you will definitely spend more money if you go to the city and find the apartment by yourself. So, I suggest that you should better make use of your Internet properly by doing your research online about the right apartment.

Once you have decided that the apartment you have chosen is the right one for you, because it is affordable and it provides a great space for you, you should know the terms of agreement through the landowner before signing the contract. Also, before signing, see to it that you ask important questions. This is the key when looking for affordable San Antonio apartments.

Deeper Analysis of a Potential Apartment Purchase

After using a property’s annual income and expense data, combined with the local cap rate to determine value, most offerings will be set aside as the unrealistic dreams of a deluded seller. Occasionally, however, a property will pass our first scan and deserve a second look. So what are the next steps to determine if we’ve really found a keeper?

The first step is to dig more deeply into the financial reports released by the seller. The critical thing to watch for here is to separate the actual figures from the pro forma numbers. Every seller, with the help of their broker, will attempt to paint the rosiest picture possible. You’ll do the same when it’s time for you to sell.

As an example, I’ll use information pulled from the most recent offer to cross my desk via Loopnet, a 28-unit C class apartment in Colorado Springs, offered at $1.3 million.

The Annual Property Operating Data (APOD) is a one-page summary of income and expenses. It calculates the Net Operating Income (NOI) as well as the cash flow before taxes. This particular APOD shows a cap rate of 8.79%, certainly within the current range of 8-9% expected for this class of apartment in this town in this year. It also lists the cash flow as $114,280 per year, or just over $9,500 per month. Assuming you paid the asking price of $1.3 million and put down 25%, or $325,000, the cash-on-cash return would be 114,280/325,000 or 35.2% So far, the numbers look promising.

But let’s look a little deeper. One of the easiest tricks to play is to merely leave some lines of the APOD blank. It’s easy to overlook something that is not even there. On this APOD there is a line for Management Services, but there is no number next to it. Even if you choose to manage it yourself, you should put a value on your time and effort. As it turns out, last year $8,300 went to this line item, which represents a 7.2% charge, reasonable in this market for this size property. Of course, underestimating your expenses, in this case by leaving one out, has the effect of increasing the NOI, which drives up the property value.

The other sin of omission occurs here by neglecting to include the annual debt service. Using the broker’s assumptions of 25% down and a 4.5% interest rate, the total mortgage payment is $60,800 per year. This is subtracted from the NOI to get the actual before-tax cash flow, which now drops to $53,480. This makes the actual cash-on-cash return 16.5%, definitely decent but less than half of what was shown on the APOD. Leaving out the management fee and the debt service has the effect of making this deal look much better than it actually is.

Now let’s look more closely at the income assumptions. The APOD has a note indicating that the current market rent for one-bedroom apartments is $495 per month. Since all the units in this apartment are one-beds, it’s easy to calculate the Potential Rental Income as $166,320 per year (495x28x12). However, in another part of the sales package labeled Income Summary, we find that less than $110,000 was actually collected in rent last year. Why the huge difference? Well, the current rent roll shows that 17 of the 28 units are paying $425 or less per month and only 2 are paying the full $495. What gives? Is the current owner asleep at the wheel, or is there something lacking in this property that prevents him from getting market rent? This is definitely something a potential buyer needs to explore in some depth. In fact, using actual numbers from last year, the cap rate at the asking price is only 4.7%!

Moving on from the financial analysis, we need to envision all the ways we can add value to the property. One of the easiest and most obvious ways is to improve the curb appeal. Potential renters won’t even slow down if the place looks like the owner fell asleep in the 70s and never woke up. A new top coat on the parking lot, well-trimmed and manicured landscaping and perhaps a new exterior paint job can make an apartment look like new almost overnight. Of course if the property has been a low-vacancy eyesore for a few years, changing the name and putting up new signage lets people know a new owner who actually cares for the property is now in charge.

Once you get a prospect inside, they will compare the perceived value to that of other apartments they’ve looked at. This is where your personal market research comes in. What amenities do other properties in your rental range have? Will you need new kitchen cabinets or will a paint job and new hardware be sufficient? Will you opt for new carpet or will you try the linoleum that looks like a hardwood floor? New lights in the kitchen and bathroom can add pizazz for very little cost.

Windows are a controversial topic among owners. If the residents are paying for utilities, it doesn’t directly help the owner to put in new ones, which is why you see so many older buildings with original windows in place. On the other hand, new double pane energy-efficient windows, along with uniform new blinds, can instantly improve the curb appeal. You can also tell prospects that their utility bills will be lower and their apartment quieter and more comfortable. It’s also one more thing the person who buys from you won’t have to pay to replace. In addition, there may be utility rebates available that lower your net cost if you choose to install them. Needless to say, all these expenses must be accurately estimated and still have all the numbers work. If a property has a lot of deferred maintenance, you must factor that into your offer or it’s not worth buying.

The bottom line for all this is how much can you raise the rents? Can you raise them enough to justify these expenditures? Can you buy it cheaply enough to allow these upgrades? You’ll definitely want an experienced member of your team to help you make these decisions when you’re first getting into this.

Finally, you need to look at the operating expenses to see if there are ways to reduce them. Running a more efficient, smarter operation can lower expenses. Do you need a full-time employee or can you outsource many of the operations? Can you charge back your residents for common area water, gas and electricity? Are they being charged for their share of trash pickup? Your market may put limits on how much of this you can do. You might also experiment with a lower rent plus these utility chargebacks versus a higher, all-inclusive rental figure to see which is more enticing to your prospects.

Once you’ve done your quick 5-minute evaluation of the numbers, most properties will be revealed as the duds they are. The ones that pass that first screening are ready for this more in-depth analysis. Once they pass this, it’s time to submit a Letter of Intent and let the negotiations begin. Have fun and good luck!

Patong Apartment Rentals

If you want to spend your vacation in Patong, Phuket you should definitely avail the best Patong apartment rental that you can find. It would be more convenient if you would choose to stay in an apartment most especially if you plan to stay in Thailand for a long period of time. It would be a lot cheaper if you stay in an apartment as compared to a hotel. If you choose an apartment, the space would definitely be larger and you can definitely feel the comfort of your home. On the other hand, if you choose to stay in a hotel, the space would just be limited as the most affordable ones are just rooms. The suites or the larger spaces would definitely cost a lot. So, if you really want to enjoy your vacation at the comfort of a home without having to spend too much, it would always be best to stay in a Patong rental apartment.

There are several considerations that you have to look into when it comes to choosing a good Patong apartment. You have to make sure that you only choose the best so that you can definitely make the most out of your stay in the said area. Here are some of the standards that you have to consider in choosing among the various available Patong rental apartments.

Choosing The Best Apartment

Location

One of the most important consideration in choosing an apartment for rent in Patong is the location. It would be best if you are able to choose an apartment that is located strategically, preferably in the heart of the city. This will allow you to have easy access to the most famous tourist spots and attractions in the said area. It would definitely more convenient for you if you can stay in a place wherein you will just have to walk a few minutes just to reach the shopping center or the museum or any other tourist attraction in the said area.

Comfort

This is another important consideration in choosing among the available Patong apartment rentals. You have to make sure that the place you will stay in will definitely give you much of the comfort and relaxation that you deserve. It would be best if you can feel the comfort of your home right in the apartment that you will rent. Make sure that the space is right for you and the place is not crowded. It should have proper ventilation as well and all the other amenities and features that you can definitely expect from a comfortable home.

Affordability

The price of the Patong rental apartment is definitely another important consideration. You have to make sure that the price that you have to pay for the rent will definitely be worth it. Make sure that your chosen apartment will truly be budget friendly.

These are some of the most important considerations that you have to look into when it comes to choosing the best Patong rental apartment for your vacation.