Bear with me, although I've been a member for several months, this will be my first time posting. I'm new to investing and have been trying to learn as much as possible from BP as well as my local REI group over the last few months.
I have stumbled onto a potential investment property, one that I would like to hold and rent out using short term / vacation rental methods, while also living in it myself. The current owners are willing to do owner financing, which seems, given my current financial status, a great option for me. The only issue is that in addition to the purchase of $60k, I am estimating I need about $20k to fund renovations that would be necessary before renting. I realize that it is extremely unlikely a private or hard money lender would be willing to take a 2nd place lien (after the owners).
Knowing that traditional /conventional financing is not an option for me, what other creative methods could I think about? Would it be possible to get private money for this type of buy & hold and finance the purchase + the renovations together - i.e. the $80k?
As if that wasn't enough to think about for a newbie, I've also found a really great property to flip. This one has the potential to garner enough profit to fund the renovations on the first property and then some. So one thought is to move forward with the owner financing on the first, get private money and/or a partner for flipping the second and use the profits to fund the rental renovations.
Much appreciation in advance for any comments, suggestions, and / or contacts in the Atlanta area that might be interested in working with me!
Hope everyone is having a successful day!
@Donna Toepfer Glad to have met the woman behind the mask!
Run your numbers and see if they help you answer some questions.
Deal #1 - Month's Rent/ $80k >= 1% ? (Good Atlanta Suburbs Ratio)
$20k HML + $60k Owner Financing + Holding Costs are
What are the renovations? Risky? Sounds like a lot for a hold. If I spend more than $20k to renovate, then you either need to BRRR or flip. Will you have these options as well?
Deal #2 - Flipping is fun, but it's hard. I'd be happy to consider or refer a partner on this.
Lastly, Cash is King! Have a bias towards building capital and experience. If you find a good owner financed deal with significant rehab expense, sell it. Add to your cash pile. Rinse repeat until you have a track record, good team, knowledge, etc.
Hi @Rick Baggenstoss , so great to hear from you! I appreciate your feedback!
Deal #1 is pretty unique, and not in Atlanta. It's a historic property in a small town south of Newnan. I'm struggling to find comps for ARV because of this. Historic is such a niche market. It is an active area though, as other historic properties surrounding it are currently being renovated. I do feel I'd have a secondary exit strategy of selling, post reno. Although, I realize it'd probably take longer to find that niche buyer.
I'd love to speak with you about Deal #2, it's near the Beltline in a neighborhood called Mozley Park. I'm headed to see it this afternoon. Perhaps we could talk tomorrow?
Hope your projects are going well...I got to see one not too long ago with Sheree!
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