All Forum Posts by: Andrew B.

@David Vander Pol You really should read Long-Distance Real Estate Investing by @David Greene. I have found it to be maybe the most actionable book I have every read and focuses completely on building a team for exactly what you are talking about doing. I am finishing up my first reading with highlights for action on almost every page. It is outstanding and lays the exact framework you are looking for. 

In addition, I'd suggest reaching out to potential contacts in your investing area through BP, email, phone calls, etc. One of my Keller-Williams agents in Omaha is just getting started in his career, but connected me with another agent who is also an investor and works only with investors in the area. She has provided me a TON of insight and contacts in just a 45 min conversation and an email. And I fully believe what David states in his book, Property Managers know EVERYTHING about your market and are probably the most important piece.

Tell everyone in the area what you are looking for and trying to accomplish, and you'll find someone who knows some other people, who can help push open the gates.

Also, if you can, go get your feet on the ground in your investing location and hit some of the meetups, or even just grab lunch, coffee, etc. with a handful of people already in that market. Trying to do it all yourself is a fool's errand and you will never get forward momentum.

Good luck! I'll be joining the long-distance game in the not too distant future as well!

Hello BP Brain-trust,

I am looking for advice on a potential offer on a pre-foreclosure property. The property is listed and they need closing in about 12 days. Initially my wife and I were thinking of a live-in flip and sell in 2 years. Went and viewed the property today and it has some major structural settling, which doesn't bother me, but changes my strategy. Here are some facts:

• Outside of Denver, CO
• Listed at $299k with recent appraisal at $385k. Some comps as high as $400k.
• Balance owed is around $225k after seller fees.
• House is a total cosmetic overhaul.
• Seller accepting offers until 12pm tomorrow. I can't see anyone in their right mind coming close to making an offer between $225 and $299 due to the structural.
• Structural settling and slab movement - I have ballpark estimate from local contractor and I think this is going to scare away most of the people that were initially interested in this property. No one was really interested while we were viewing.

My new strategy is to just go with a straight fix-and-flip over 3-4 months. Hard money at 70% of cost. This would be my first, but have help with an experienced home builder as a potential partner who has some great connections.

To make my numbers work, assuming an ARV of $350k due to the property backed to a secondary artery road and some commercial properties, I would have to buy around $125k - $150k due to the cost of the structural repairs (slab jack, 18 helical piles, chimney reinforcement, etc.) and the full cosmetic repairs.

Knowing the owners need $225k to get out from under this thing, would you make the low offer of $125k now or wait to see what happens with offers and the bank then try to make an offer, assuming the property is still available via the bank? With the amount of structural repair, I don't know if a show of some money on the table now is advantageous or if I should wait it out?

Thanks in advance,

Andrew

@Nathan Winston This is a monthly meeting. If you search for it on meetup.com you'll find it. See you at the next one.

@Taija Walkowiak What a great job! Congrats! I just began looking in Lincoln to invest out of state and this shows there are still opportunities. 

@Max Fleissner I'm intrigued by these possibilities as well, especially in large MF and commercial uses.

@Tyler Hardy I think you missed what @Chris Lopez said. He didn't say it wasn't allowed, he said it is incredibly difficult to get approved through permitting, mostly because all the jurisdictions in the metro area are backed up months. 

A lot of these areas are currently reviewing their ADU rules also to make sure that they are implemented correctly for today's need and being done correctly, to ensure safe and secure housing to help solve some of the issues with low cost housing options in the city since many of these uses haven't been reviewed for decades potentially. That is also keeping them from handing out permits just because it is zoned for it.

Permitting in the metro area, especially for the less common uses, is under scrutiny across the board.

You are right, there are probably more than 4 or 5 that have been completed in the area over the last few years, but they don't go quickly. If these were a good market and simpler to do, there would be GC's lined up to knock them out. But, speaking as a contractor, in general, the smaller the project, the more headaches, cost, and problems, leading to changes and increased costs to you.

I've considered 2 different properties to to purchase and build an ADU and the numbers just don't pencil out, especially with the most expensive risk, time. Your situation may be different since you already own the property and have equity.

I wish you luck and if you do move forward it would be great to hear how it goes. I think a lot of people in the area are interested in the ADUs, it has just proven to be extremely difficult to move forward with confidence for most.

I've heard a lot of good things about Dundee Bank and American Interstate. Getting ready to talk with them myself.

IDK about wholesaling specifically but just used Midwest Title on a search and they turned around in 2 hours. Super customer oriented. I'll be using them again for sure.

@Taylor Burns I'd say pick up some books and start reading. Be your own advisor. Then you are in control and can research what you think you want to put your money into. 

I agree with a lot of the other comments (Vanguard funds and cash for RE).

If you want some resources to start out, the BiggerPockets Money podcast is a good place to start. As for books, Set For Life is good on basics, Your Money or Your Life for financial independence planning, The Little Book on Common Sense Investing is great if you are into the numbers and research into market performance. And of course BP and their books for RE.

Not worth paying an advisor unless you get into some complex situations, are trying to get maximum efficiency on tax situations, or have some really special needs (ie: large windfalls, etc.).

Good luck.

@Justin O'Malley I'd suggest if you are just getting started reading "Set For Life". Pretty much everything you need to know starts there. Then move on to "How to Invest In Real Estate". Both are in the BP bookstore or on Amazon.

Wish I would have started with those 10 years ago.