All Forum Posts by: Allyson Edwards

NEW CALCS... ok this may work

https://www.biggerpockets.com/forums/88/topics/627646-calc-review-help-me-analyze-this-deal

@Dylan Vargas & @Allen Maris

Yes, you are right the agent fee was low, I bumped from 2 to 3% but that was bc I knew the agent and I was hoping to negotiate that %. (should I go higher? 6%)

That being said probably should NOT do that, assumptions can get me in trouble.

The reason its such a high reno $ is bc i spoke to a neighbor who said, I quote, "its a complete tear down!" Before I spoke to him I spoke to another RE agent(different from listing) in town who said it needs "a lot " of work... I came to the conclusion after seeing only 1 picture based on roof and exposure, age etc. that we were looking at about 150K. So I am at a stand still. I am getting NON agent access to it tomorrow night from a friend of the homeowner... so I will hopefully know more. Any thoughts? What should I look for? This could be awesome or a complete MONEY pit!!! I tried to put a new calculation with all the numbers but i can not cut and past it so it will have to be in a NEW POST.

$950,000.00AFTER REPAIR VALUE

$100,000.00DESIRED FLIP PROFIT

$675,500.00MAX ALLOWABLE OFFER

$123,000.00REPAIRS NEEDED

According to the data you provided, you can afford to offer $675,500.00 to make a profit of $100,000.00. This is based on an ARV of $950,000.00, a rehab budget of $123,000.00, and holding costs of $12,000.00.

Financial Breakdown

Purchase Costs

TOTAL REPAIRS:

$123,000.00

Return on Investment for Flip*

(Based on no loans or leverage)

12.25%IMMEDIATE

49.67%ANNUALIZED

View report

*This link comes directly from our calculators, based on information input by the member who posted.

Anyone wanna take a stab at this one?

Anyone interested in a partnership? I have the knowledge of the area, the contacts to negotiate the price, the design skill, and can get GC and local construction going. In other words I can head up the project, I just don't have the money. 

If you know California, and you know Santa Barbara this is a smoking deal...I think it is at least. Thoughts? 

Im doing what @Brandon Turner and @David Greene tell us to do "get out there and make the deal happen"...

There is a lot more story that goes with this house so I padded the rehab costs a lot...Im going to see it tomorrow night in person. 

Thank you to anyone out there.... 

@Jason Hunt Couldn't you do 1031 exchange to avoid the tax?

I only use Sherwin Williams( now)...I was using Behr and sorry but it sucks. SW has much better coverage and is self leveling and I opened a biz account and get 40% off the paint at the SW store.

I'm here bc I'm interested in seeing what others have to say. I'm a pretty new investor myself but if I were to give any thoughts I agree with @Thomas S. I would think Seattle area would command much higher rent than $1600 for 3/2. So rent should have been raised and PM should have been a bit better at telling you that. Also I can understand having debt to family can be weight on the shoulders and stressful. So getting as much as you can by selling could be a good idea. Especially if you plan on staying East. Although new roofs can be a real PIA when selling, you'll have expenses to sell it as well. Any chance you could AirBNB it? That usually increases cashflow better than long term rental. Best of luck...

Well that was fun! 😂

@Jay Hinrichs, @Frank Wolter, and any one else who can answer this side question...

If you have Buy an Hold rentals and say you want to pay them off, (I guess one by one?)

What money are you using to pay down the mortgages? The cash flow coming in?, Do you pay extra payments? Do you use your W2 income? other types of income? How does it look? Being debt free sounds really nice...

Originally posted by @Nick Gray:

I am a relatively new buy-and-hold RE investor at age 24 who is looking to make a career transition and who needs some advice. My long-term goal is to go full-time as an investor, but in the short term I of course need to maintain a steady job to pay the bills and fund future deals. I have been working as an aerospace engineer for 2 years since graduating college, but I have lost passion for the profession and need a change (no offense to the other engineers out there, it's just not for me and I've become too fixed on real estate). I would like to find a full-time job in real estate to increase my experience and contacts in the industry, as well as to simply enjoy my work more. However, I'm not sure what job is best. I just got my RE salesperson's license and will soon begin selling homes, but I recognize that won't provide fixed income and could take a while to get going. Given this, I think that I still need a 9-5 job for now.

What RE-related 9-5 job would others recommend in my situation? Property management? Working for a RE investment firm? Something else that I'm not aware of? 

Money is not everything, but salary is a factor and I wouldn't want to give up too much, if anything, of what I currently make as an engineer. If it matters, my education includes a B.S. from Cornell and an M.S. from Stanford, both in mechanical engineering. I have no formal RE education, but I self-manage my own rentals, read RE & general business books incessantly, and have strong communication skills. 

Thank you in advance for your advice!

I can only speak from experience. I am currently in a good paying job for 25 years that I have been mostly passionless for. For years I was told RE and investing is too dangerous and too much hard work. And so here i am 25 years later and just starting as a newbie investor. I felt and feel exactly as you state above. Its not a millennial thing its just a "thing" or a feeling you have,  I understand. That being said I urge you to look at what you have on your plate right now. Its a stepping stone. You said it yourself, short term you need a good steady paying job and long term you would like to be a F/T investor. Keywords there are long term and short term goals! Right now 2 years newly graduated is not long enough. Take serious inventory of what you have or can have with the engineering field you are in (that you would not get elsewhere)...a very good salary, steady salary, health benefits, 401k or profit sharing depending on the company, experience in the work force and corporate structure, also the consistent income and job history... as we all know banks look for that when you are applying for loans etc. Most other commission based jobs don't have all those steady streams of certainty. Don't forget we are supposed to have a "crash" soon (thats sarcasm) you are going to want to have that steady engineering career so that you may continue to have income to buy all these properties at good "deal" prices when that crash hits. Maybe you could work 10 hour days and have one day off a week to pursue and go full in to RE/ investing or take a low paying or non paying job at a RE office and learn the ropes that extra day Or weekends, get creative with your engineering schedule and time off from engineering. But don't throw that degree away over a long term goal without the patience...long term put your time in even though you don't love it. May I offer a good read? Its a book called "So Good They Cant Ignore You" by Cal Newport. It may help you with your current situation.You can do it, go to your job... sock away as much as possible, spend less than you earn, and in your spare time hit the investor wagon and make tons of networks! I wish I was 24 again to take this approach. It sounds like a long time but 10 years can go fast. In that 10 year time span you could be scaling back on engineering while making $$$ and scaling up on investing, before you know it youll be a full time investor sipping drinks on the beach. Stay the Course....Hang tight.

Thank you...