I cannot begin to say how HUGE of a response we have received from folks all over the globe in regards to our refinancing/cash out/new assets program—so we decided to show an actual “real time” transaction we are preparing to fund and close next week. This should give you some insight into how you can invest in U.S. property the right way.
Here is a case study of a new purchase/refinance that we are doing for one of our Australian investors. Sometimes it is nice to see how one of our clients has taken advantage of our refinancing program, and how he is using untapped equity sitting idle in Texas to build on his portfolio of assets.
This property in Dallas above was purchased in 2013 for $120k. It has now appraised at $150k. It is rented for $1,300 per month. After taxes (they are HIGH in TX) at $179 per month and property management at $130 per month, the yield was $991 per month.
Our client COULD have taken $75k out with our program, but instead decided to take $50k to cover all loan and new purchase insurance and tax obligations. With a $454 monthly mortgage payment, he will now yield $537 per month.
The client is buying this large split level home below, 1/4 mile from Longview Lake. Great home. Great area. HUGE capital appreciation. Neighborhood comps are $120k+, but it is being sold to him for $102,500.
After loan payment, taxes, insurance, and management costs, his monthly yield will be $358.58 per month. THAT’S how you invest in U.S. property.
Combined, his cash flow will be $895.00 per month
So, where is the benefit in reducing cash flow $90.00 per month? That’s a simple answer.
This client is using his current equity position in Dallas to add a second property to his existing portfolio. He has spread the risk of a single property across a second asset. If he owns one property and rent is late or the tenant moves, his cash flow is zero. If two are owned and there is a cash flow issue at ONE property, the OTHER covers the risk. Both Dallas and Kansas City are appreciating rapidly in value, so there will be higher equity and better resale value a few years down the road.
In other words, why would I own one of something if I could own two of something and receive better long term results? Why would I NOT spread and lessen my risk profile? And if I did not have to spend another dollar of my cash reserves to do it, why would I resist? If you’re going to invest in U.S. property, do it in the safest way possible.
Savvy investors get it.
Look here for more info on refinancing from our website.
Watch the 3 minute Atlas Financing Video below!
Feel free to contact me, and as always…….happy investing!
Principal, Atlas Capital and Asset Management