All Forum Posts by: Alex Deacon

@Jerry Quintiliano your questions is impossible to answer. There are so many different levels of construction , quality, bathroom count etc... You will need to do this the hard way which is get estimates and shop around. Check references when choosing a contractor and never give a large down payment. Also check in on each phase of construction prior to releasing any funds to the contractor. If you are doing work in the Pittsburgh market look up @Jeremy Taggart a local agent who does a lot of buying and holding renovations. He may be a good resource for you

@Andy Madden from what I have heard from other attorneys, a lease option is the best method. Unlike a mortgage you can take back the property much easier and wont have to do a foreclosure. Also you should make sure the person holing the mortgage for you is aware that you are renting out the property. He also may want to be additionally insured since he has an equitable interest in the property. I have a few good RE attorneys in the Pittsburgh market that would help you structure this and keep everything legal.

@Caroline Siller the hardest thing to do for me is to be patient. I will suggest you take your time, continue to gather information, surround yourself with highly successful and ethical mentors and when the time is right dont hesitate to take massive action. I dont trust most turn key providers. I believe if the deal is right they would keep it for themselves in most cases. I am not saying you wont find a good one but if you do, get the contact information of 12 of their clients. Reach out to each one and talk to them about their experience. You want to talk to clients who have owned the properties for more than 2 years. Not the new clients who just bought one investment.

@Luis Ramirez . You have some very basic questions and there is nothing wrong with that. You have to start somewhere and its always good to ask, listen and learn first. 

1. You will have to pay property taxes at closing. They will be prorated. If you are using a lender the lender may require some of the taxes to be escrowed also.

2. You need to get insurance and if getting a loan the bank will dictate some of the coverage you need. Most likley it will have to be paid in full for the first year

3. If you are buying in Pittsburgh which is the market I am in there is transfer tax. For example if you buy in the City of Pittsburgh you would pay 2.5% of the sales price. Outside of the city its usually 1%. Sometimes a little higher depending on the borough.

Tak with your lender about bank fees, points, appraisals, doc prep, title insurance etc.. They can draft whats called a good faith estimate for you spelling out all the expenses you will incur.

You can Private message me if you need anything further. 

@Doug Britton Bigger Pockets is a great start. Begin networking with local professionals and increase your real estate IQ. Always be learning. Your first deal should be a solid and safe one. You dont want to start out with high risk and high stress.

@TJ C. The information provided by @John Underwood is spot on. The only issue you may run into is how long will it take the seller to negotiate a lower payoff ? That can take a long time and never happen at all. Hopefully the seller has enough proceeds from the sale to pay off all liens. If they dont have enough funds from the closing and they dont have any extra cash to pay off the liens you could be at a standstill. Your agent and or your attorney should advise you.

@Chris Nocera as far as I know section 8 here in Pittsburgh supplies the lease. We have to use their lease. What area is your section 8 property? I only deal with Allegheny county and Pittsburgh

@David Lao I do like the approach of asking yourself what are you going to do with that money after you sell. What kind of return will you get elsewhere? You will have capital gains tax to pay so account for that also. If the population is declining and there is no sight of any major economic development in sight for the area then you may want to consider cashing out. Most markets across the nation right now are a sellers market. It may be the right time to liquidate. Nobody can answer your questions. There are too many variables. I have invested in the Pittsburgh PA market for nearly 30 years and if I had a crystal ball there are many properties I would have kept long term and many I would have sold. Some micro markets within the Pittsburgh region have exploded and some have flatlined. There is no way to know 100% which one will be the gold mine and which one will be a flop. 

@Clayton Hepler I would make absolutely sure the municipality you are in allows this type of business. If you get a neighbor complain and contact the local government they could shut you down. I have experience with Air B and B and some municipalities  have shut Air B and B down. 

@Toby Liebergesell make sure you plan out the back end. You need to find  lender who will refinance an unseasoned property. You may find yourself stuck paying a hard money lender a high interest rate because you cant refinance. I can help you find a HM lender and a conventional lender but your will need to have strong financials and the property will need to cash flow and appraise. With Covid 19 lending institutions have tightened up a bit