Buying My First Off Market Deal

Buying My First Off Market Deal

Rental Property Investor · Asheville, NC · Member since 2019 · 35 posts · 9 votes

Hi All!

I'm excited to be putting 20% down on my first off-market deal with a 30-year fixed @ 3.63%. It should cash flow nicely after renovations and hopefully I'll be able to cash out refi. I think I'm buying it well at a 22% discount (thats conservative) and there is value-add, but several big unknowns still remain. A downstairs apartment is not counted in the HLA and I can't tell if its ever been permitted. I'll need to pull permits and get it renovated before its livable. 

  • Where do I start with that process of checking if its ever been permitted?
  • How much does it cost to pull permits?
  • Do I need separate permits for electrical work? Plumbing? Moving walls?
  • How much of that work am I allowed to do myself, as long as its built to code? 
  • How do I "turn it into a duplex". I mean how do I get it classified as a duplex?
  • If it remains an SFR, how can I still rent out the two separate units without breaking any laws?
  • A big plus is that I have the first option to buy the two adjoining lots and the lot that the house is on is deep and I could build a garage apartment. What is the first step of a new construction project? 
  • How does one finance a new construction project?

Tons of varying questions and I really appreciate the input from all the great minds here!

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    • Henry ClarkPro Member
      Developer · Member since 2020 · 4k+ posts · 4k+ votes
      5y

      These are all Due Diligence questions and they are all Local questions.

      Can you slow the deal down, while still keeping it.  See if you can do a $3,000 earnest money deposit, even non-refundable for a 10 day period, normally 30 days.  Sit down with your local city code/permit group.

      I'm not an SFH or MFH person. Someone with experience can probably go through the list and say which ones not to worry about. The one, I would be most hesitant on is your question about new construction as it relates to this property. Finance companies might be hesitant to finance a property with permit issues.

    • Rental Property Investor · Asheville, NC · Member since 2019 · 35 posts · 9 votes
      5y

      @Henry Clark Thanks for the heads up!

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