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Thank you for wanting to gather a deeper understanding of what exactly I mean and the math behind my reasoning.
I have been looking around Poughkeepsie to find attractive properties to base my theory on. And one stuck out to me 12 Noxon St.. Great spot in the city, right by the Adriance parking lot, bars all around, realively close to the river, amazing restaurants such as my personal favorite El Azteca being a 15 minute walk!
An absolutely beautiful property being priced at half a million at the time of writing this. Includes 3 units; 2 - 3 bedroom units along side a single - 2 bedroom unit.
8 bedrooms total.
Above is the Property Tax Slip for 12 Noxon St..
This was found on page 1259 of the pdf linked to the photo which is the 2024 Dutchess County Tax Roll.
Looking at the City of Poughkeepsie’s Property Tax Roll we see that they paid $5,821.93 in property tax this last year 2024.
To gather the School Tax information I went to infotaxonline.com. Which gave us the 2024 figure of $4,207.98.
Looking for landlord insurance the cost is around $2,600 every year on the high end.
Which takes our yearly costs after purchase to be
Property Tax : $ 5,821.93 : $ 6,000
School Tax : $ 4,207.98 : $ 4,500
Insurance : $ 2,600 : $ 3,000
Total : $ 13,500
Always rounding up!
$13,500 being our yearly expenses.
$13,500 / 12 months equals $ 1,125 per month
Lets round up the year even further to
$ 15,000 per year
$ 15,000 / 12 months equals $ 1,250 per month
$ 1,250 / 8 rooms is 156.25 per room or 175 per room
Always rounding up!
2 Room 175 * 2 = $350 / month
3 Room 175 * 3 = $525 / month
Including a $100 a month average for maintenance and understanding that we have rounded up a significant amount at every corner it is very achievable to have rent be $450 for a two bedroom and $625 for a three. This doesn’t include utility.
Now I did say Three Bedroom to maybe become a $1,500 a month rent. This is to account for a repayment plan to the city for the half a million dollar grant if we must go through that route. If we use the industry standard of a 30 year repayment plan (no interest) - 360 months.
$500,000 / 360 months is $1,388.89 per month in extra costs.
ALWAYS ROUNDING UP!
It is an extra $1,500 per month payment.
$1,500 / 8 Bedrooms = $187.5 per room
Rounding up to $200 extra per room
$400 extra for a two bedroom
$600 extra for a three bedroom
Adding this to our privous numbers
We arrive at
$850/month for a two bedroom and
$1250/month for a three bedroom
That's not all! lets even make the payment plan shorter!!!
15 years! or 180 month repayment
$500,000 / 180 months = 2,777.78 per month extra or $3,000 extra
3,000 / 8 rooms = 375 per room or 400 extra per room
We Conclude our Theory with a maximum rent for a:
2 Bedroom being $1,250 per month
and a
3 Bedroom being $1,825 per month
WE CAN DO THIS TODAY!
WE CAN DO THIS TODAY!
Quickly looking at other bigger buildings for an example on the extreme end.
10 Rinaldi Blvd.
179 Units - paying close to $500,000 in property taxes as of last tax year.
Assuming that its insurance doesn't exceed the tax payment adding another half a million doesn't see out of the ordinary and very liberal estimate.
$1 Million every year
We obtain a $600/ month rent Just paying for taxes and insurance plus the $100/month average unit maintenance. (using the same math as before $1,000,000 / 12 months / 179 units = $465.55 / month rounding up to $500 and adding $100)
Being valued at 16 Million we can round up to 20 Million.
Repaying a 15 year non interest loan only adds $700 for everyone rent. ($20,000,000 / 180 months / 179 units = $620.73 / month) Making another very inflated estimate price of $1,300 per month for a apartment.
Keeping in mind that ALL of these units are in reality Section 8 and HUD housing both guaranteeing the landlord of (if they do there job correctly) of easily $1,400 per month ↓
*** Through tax payer dollars! ***
YOUR MONEY IS BEING WASTED!
YOUR MONEY IS BEING WASTED!
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