My Hawaii House Hack
Just got an offer accepted on a property in Hawaii yesterday, just making this as a record / log for myself as well as others to follow along and give suggestions or recommendations as the process unfolds. Wont be giving much for details just yet, maybe in a couple days when I have more time to write up a good post or two. For now, here is what I did up until today.
Pre Acceptance:
Walked the property and verified the numbers the current owner was getting with the tenants. Also did a rough estimate on repairs and talked to the owner letting her know I was highly interested in buying the property. Did a biggerpockets BRRRR calculation on the property using https://www.biggerpockets.com/brrrr-calculator (I will share this later) and over estimated on all my expenses just to be sure I'm comfortable with what I'll be getting back.
Sent in a low offer to see if she was interested in negotiating the price as what it was listed for was way more than the house was worth. Equity in the house went up almost 100k in one year (WAYY to much for the area and the house) and if you want a hint on the price they were asking, the taxes went up 20% in that year.
Got countered at 50k less than asking and I countered their counter offer with 100k less then that. They rejected my counter offer and 20k below their original counter offer. I declined the 2nd counter offer because I felt the house was still worth way less than what they were asking and moved on.
About a week later I got another offer from them for 100k less than initial asking price I still disagreed esp because I never saw the 2nd floor or did a full walk through in every room. They wouldn't budge at their price and said if I wanted to negotiate the price more i would need to go into escrow.
I nearly walked away from this deal again but decided to give it a go, but just to be safe I made sure I covered my assets ;) My offer was written up for their new asking price and I made sure I wrote in a couple contingencies to back out if needed as well as have the seller pay for an inspection. Oh almost forgot to mention. Earnest money was only 1$ :) with no additional money required.
Had to redo my BRRRR calculations because of the newly negotiated price but it still slightly fell within my comfort zone. Still not very happy with the price currently.
After Acceptance:
Got accepted the same day (yesterday) late afternoon. Figured it would be best to wait till first thing tomorrow to start making phone calls.
Today:
Woke up early and did my research, texted some other real estate friends and asked for referrals for inspections as well as wrote a list of things to do. Also marked out the dates on my calendar of key "need to do before" dates so I wouldn't forget.
Called around to some of the suggested inspectors and asked for quotes and dates of availability as well as called up my mortgage company to let them know I will be needing them to start some paperwork. Let my realtor know about the dates and times the inspectors were available and told him to let the seller know so they can pick a date to open the house up. Also asked the realtor where I needed to go to drop off my 1$ earnest money check :)
Here's a list of things I want inspected for in this house:
Mold, Asbestos, Lead paint, Lead pipes, electrical, plumbing, zoning, permits, setbacks, height limitations, other environmental assessments, land surveyor, pest control operator.
Also since this property is close to the beach I called a couple friends who are working on quotes for insurance.
I'll keep updating this post as the weeks go on and release more of the property information and other info as well as pictures!