Deals to analyze in Birmingham

10 Replies

Please Help. All opinions welcome. Looking to get both C and B class props in Birmingham.

1). B Class

SFH

3/1

1800 square feet (addition done on the back)

Large Corner Lot

No garage

Built 1959

Located in Center Point 35215 area code

Irwin Schools

Price $70,000

Rent $850

New roof, hard wood floors, new HVAC. Older windows. New paint and basic cosmetic stuff.

2) C class

SFH

3/1

962 square feet

All brick.

Located in Bessemer 35020

Hard wood floors, new HVAC, updated plumbing. New paint and basic cosmetics

Price: $50,000

Rent : $700

Joey,

I've been buying/selling and managing rental property in Birmingham since 2003.  I have to tell you that those prices are too high. 

There's a lot I could say about turnkey here in Birmingham but I'll save that for another time.  I sat down with out of state investors the other day looking to place 900k in Birmingham and after looking at the list of properties they were presented to buy from a 'turnkey' expert, I had to tell them the truth about that junk list.

Instinctively they thought something was wrong when they visited and saw burned down houses on the same street and a lot of vacant properties.

I'm not saying these houses you're looking at are junk...but what I am saying is you need to be crystal clear on the neighborhood, the condition of the houses and the type of tenant placed in the house.

All it takes is a couple of months of slow pay, then no pay and then you've got an eviction on your hands. In Alabama that takes 3 months.

Investors lose money on turns...and that's money you can't get back from another tenant. The goal is to buy a great house, get it in great condition and have a disciplined underwriting process. The way you make money in this business is to keep a tenant for 10 to 20 years.

I'm actually working on an ebook now about Birmingham's turnkey business and how investors really make money in this business.

I'll step off my soap box now...sorry for rambling on.  

Ha, i've been looking into Birmingham to pick up rentals myself and have been analyzing 2 properties in almost the same 2 areas!  However, the prices I was seeing were a little lower.

@Spencer Sutton everything you said is why I'm yet to purchase a rental. I'm a fix and flip investor in CA so I can't get myself to pay retail (or even a little higher) for a 'turnkey' property. But then I'm too far away to really analyze deals from wholesalers, or make educated offers off the MLS. I'm starting to think I need to pick a market and just take a couple long weekends out there.

I'd be very interested in reading your ebook, when do you expect to finish it? 

For me. Being inexperienced and out of state makes turnkeys so attractive. Even if you do pay a little more for them. The stress levels are lower and you collect the rent right away. Hands off easy way to invest in real estate. Trying to do it by myself during my growing years of real estate investing is to risky in my opinion and could potentially cost me money through a bad deal, bad rehab, or bad management. I'm not there to monitor this process.

I just got the rough draft from Matthew (gkhouses.com owner) yesterday and I'll be working on finishing that one along with one I'm writing with a 35 year veteran about how to keep a tenant 20 years.  

I'll post something on BP when we're done and make it available to anyone who's interested.

@Spencer Sutton

How's that book coming along on B-ham, my friend? Btw, TGIF :)

Hey @James B.

The book is coming along and is out at the designer now making it look great (I hope!).  It should be ready to share by late next week.

Here's the ebook 

https://gkhouses.clickfunnels.com/5-turnkey-manipu...

@James B.