www.CostaRicaTicas.com

An aptarment building with 8 two bedroom one bath apt. 4 up 4 dn, green areas, 4 double car garages w/remote, upstairs balconies , safe, and quiet. Great investment opportunity. Also Micro bus-2000 Hyundi-Grace. Owner is will to sell all for $425,000. Income from apts.-$3200/month, income from micro bus is up to you.This property is one year old in very good shape and is located in Barreal,Heradia. The owner will sell Apts. for $415,000 and the Micro bus for $12,000. Or make offer.

Milwaukee?

As an owner of apartments in the Unites States, I would require more income for a $425,000 investment. I also would not include a business with a purchase of apartments. Businesses come and go and are only as good as their operators.

Have a Great Day,

Dave

Dave,

A ton of bricks is fixing to fall in Costa Rica real estate wise here shortly. Watch that $425k shrink to $42.5k ASKING darn quick!!!!!! There is a storm on the horizon.....

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"Actual happiness always looks pretty squalid in comparison with the over-compensations for misery. And, of course, stability isn't nearly so spectacular as instability. And being contented has none of the glamour of a good fight against misfortune, none of the picturesqueness of a struggle with temptation, or a fatal overthrow by passion or doubt. Happiness is never grand."
- Aldous Huxley, Brave New World, Ch. 16

I sold fair amount of commercial property in my real estate days. Commercial property is priced very differently than sfr's(single family residential).Numbers run relatively right.The micro bus must be purchased as a seperate transaction.It should not be factored into the 425k asking price.Never mix depreciating assets into a real estate transaction.My challenge would be to really prove the validity of the rental situation.Does that money really come in? What condition is the property in, etc.It will not drop to 45k as Steven wishes.Assuming the revenue numbers are true. Worth a look but really hard verify those numbers and title.

Assuming all is well, I would put the property in the 360k range.Depending on the location.

I would break down the value as follows and based only on income and no appreciation: Income $3,200 less 35% cost for all maintenance, taxes, insurance, vacacies, theft, etc. I use the 35% figure as a maximum and can normally be well within that figure. That leaves approximately $2,080 in net income. I expect a 8-10% cash on cash return which would put the 8% return at a price of $312,000 and the 10% return at $249,600. ($2,080 times 12 divided by .08 or .10) The difference being probably the safety that I felt in the location. In this case, I would expect the 10% return for risk of being out of the country and not in my geographical location.

I would be interested to hear how other come up with the value. This is a highly indiividual opinion as risk/reward are different for eveyone.

Have a Great Day,

Dave

Guys the owner has had the apts. for over a year, he does all maintanance,taxes are little,no insurance, and in Costa Rica if rents are paid in colones you can raise the rent up to 15%/year. Pm me if anybody wants to see and report back to CRT.[/img]

I have a buddy here that uses the "100 month" rule. In this case, $320K would be a good ballpark figure to pay, but then as Brother Zuko indicated, taxes and insurance are lower in CR so I don't know.

_________________
"A man accustomed to hear only the echo of his own sentiments, soon bars all the common avenues of delight, and has no part in the general gratification of mankind"--Dr. Johnson
"Amen, brother"-ED

Insurance is cheaper? What he said is that the guy has NO insurance. Can't get any cheaper then that.

_________________
Pura Vida
Only Irish coffee provides in a single glass all four
essential food groups:
alcohol, caffeine, sugar and fat.
Alex Levine

Just because the present owner is "going naked" (no insurance) doesn't mean a new owner should also.Thus it has to be factored into the cash-flow, yes?

_________________
"A man accustomed to hear only the echo of his own sentiments, soon bars all the common avenues of delight, and has no part in the general gratification of mankind"--Dr. Johnson
"Amen, brother"-ED

Absolutely. Is part of the PITI (principal, taxes, interest, and insurance) that are a part of any real estate transaction.Makes me wonder why no insurance.Maybe property is uninsurable for some reason?

Steven1 said:


Verdad!

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"Your love gives me such a thrill
but your love don't pay my bills,
I NEED THE MONEY!" - John Lee Hooker

Disclaimer: The above is merely the opinion of the author unless specific scientific data is included.
Your mileage may vary. https://costaricaticas.com/phpBB2/viewto ... 978#206978

Prime apartment buidings in the US go for 10 to 12 times gross income. So that would put it near your estimate. But that is in the US where there is no foriegn risk and more liqiudity and leverage ability from banks (some left).
This building after factoring in those to draw backs is worth in the 250-300K range

Absolutely agree. My point was that you can not make the assumption that insurance is cheaper in Costa Rica based on this particular example.

_________________
Pura Vida
Only Irish coffee provides in a single glass all four
essential food groups:
alcohol, caffeine, sugar and fat.
Alex Levine