All Forum Posts by: Andrew Thomas

 Thank you. I just saw your reply. I've been busy with the flip and other stuff, and haven't been active on BP lately. :) lol

I was trying to add this to my "personal profile / portfolio", and I ended up with this thread. I didn't realize it would be public. Can't edit it to add the expected ARV / comp info, which I forgot to include, so adding as a reply. :-/

Purchase price = $240k
Appraised as is = $267k
ARV w/ 2nd bath = $282.5k

Expected holding costs = ~ $3k/month ($1.3k HML, $750 HELOC, $625 PML, utilities, security, garbage (AKA taxes).

Expected reno time = 6 weeks. It's supposed to be 70* the week between Christmas & NYE, so I plan to paint the exterior window trims, and pressure wash the driveway & exterior brick. The back patio area is concrete, covered with loose bricks, with 3-4 railroad ties for steps down to the yard. Those steps need to be replaced or rebuilt. 

Closed on my first flip house yesterday. Needed about $70k to close, plus $15k rehab. Took out $50k on a new HELOC, and got another $50k from a friend I have known 10 years. He was very interested in getting into a real estate deal, but doesn't have the time or knowledge, whereas he knows I have both and have spent months researching.

In his case, he agreed to a 15% interest (1.25% per month) up to 12 months. We had originally discussed a 50/50, but he was fine with me doing the sweat equity and him being a money partner only, due to his work schedule. The lending broker suggested I do a joint venture with him, and pay a flat 15% interest, rather than doing a 1/2 split.

If you have friends who have money, or who have discussed real estate with, see if they would be interested.

Investment Info:

Single-family residence fix & flip investment in Cartersville.

Purchase price: $240,000

Lipstick flip. 3/1 full brick, adding 2nd bathroom, painting cabinets, interior walls, trim, etc. Securing with SimpliSafe purchased thru BP. Purchased from a local flipper; his team estimated $12k rehab, including bathroom.

BUY:
Private money $13k (out of $50k available)
HELOC on personal residence $50k
Hard Money Loan $180k

REHAB:
Private money or personal funds

What made you interested in investing in this type of deal?

Want to start buying rentals. However, a friend (who is a local flipper) suggested I instead start by doing a few flips for quick cash to build up a nest egg quickly, which I can then use for the buy & holds.

How did you find this deal and how did you negotiate it?

Have been asking my friend to keep me in mind if he found any "simple, quick, beginner" flips. He is running five flips right now, and most of his are longer term projects, with fairly extensive renovations. He suggested this for the more gentle learning curve, and provided contractor suggestions.

I didn't negotiate it. It's my first project, and I know I'll need lots of help and counsel, so I figured it would be best to just pay and not try to beat them down on the price.

How did you finance this deal?

$5k - Personal funds = Earnest money of $5k
$50k - Personal residence HELOC = Down payment of $50k
$50k - Private money from a friend = Down payment of $12k, balance for holding costs & rehab
Total of $62k for closing day
$180k - Hard Money lender

How did you add value to the deal?

1950's era home. Currently 3/1. Existing bath is full tiled shower only (previous owner was older, single w/ no kids). Adding 2nd bath w/ tub for families w/ kids, pets, etc.

Kitchen is dark finish, solid wood paneling. Painting cabinet doors and frames, adding granite counters. May also paint the wood paneling a lighter color.

What was the outcome?

Closing is tomorrow, so I don't know the outcome yet.

I will return to update this as the project completes. Expected rehab is about 6 weeks.

Lessons learned? Challenges?

Financing the first deal is a PITA, and everyone wants their pound of flesh, plus a few extra ounces. Once I have the first done, know the process, and have a track record, it should be better. Having all funds in one bank would also make financing smoother.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I will recommend a couple when I update this. The agent was very patient helping me get things together, and her lender is AMAZING!

Question re: Multi-Fam bootcamp... In a couple of recent podcasts, Brandon talked about the difference in strategy, mindset, systems, etc for small (>10-12 doors) vs big (20+ doors) multi-fam. This was also mentioned as part of the reasoning for two different multi-fam books that BP just produced.

Personally, I think smaller would be a better fit for me at this time.

Is this boot camp focused on small, big, or all-the-above?

Trying to decide between multi-fam and rookie bootcamps.

John, do you know if your local bank is still offering this? I'm NW of ATL, and would be interested in chatting with them if so.

Nelson, 

Thank you for taking the time to reply. Nice to see someone local on BP. :)

I appreciate your feedback, and the info on your roof. I didn't realize roof replacement could be financed, but that is great info to know! :)

In this case, the house is currently Pending, according to Zillow. If it comes off the market again, I may make an offer. I'm in process of lining up some potential lenders, so I have a couple to choose from. 

Thank you again. 

My plan is a long-term buy and hold. I don't plan to sell at any point, currently.

Some of the numbers I was estimating, as I have not made an offer yet, and cannot get inside to get renovation / contractor pricing, or exact bank fees, rates, etc.

View report

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



Hello BP :)

As mentioned in the description, I'm an REI noob. I found what I *think* is a potentially good BRRRR candidate. Just want to get feedback from more experienced investors before proceeding.

My agent sent me a copy of the inspection report from the listing agent. Summary:

House was built about 100 years ago.
Converted to a triplex at some time in the past. 100% occupied.
Vinyl siding. Some small / finger-size holes, but overall good.
Linoleum flooring. Recently replaced in unit C.
Interior walls in Unit A are separated from ceiling. Either interior walls were built & installed incorrectly (owner / handyman DIY?), house settling, or weight of roofing (that's what the roofer thinks).
Horizontal & vertical crack in foundation wall. Inspector said related to house not having gutters, so rain puts pressure. Crawl space house.

According to inspector, will need roof soon. Currently 2-3 layers shingles, plus metal roof on top of that. Inspection said it's not clear if it is 2 or 3 layers; also due to age of home, "possibility of asbestos shingles on the bottom layer". Contractor estimated $14k-$18k, due to labor, dump fees, new roof install, etc. He thinks it is 1x6 decking due to age of home; since that is no longer code, it would also need all new OSB roof decking, which is included in that price. Some water stains on unit A ceilings, but I don't know if it is currently leaking, or old stains, if the inspector saw any wet roof decking in the attic, etc.

Lot is ~ 1.5 acres. Landlord pays mowing, and water. Septic tank(s). Backyard fully fenced with gate.

A - 2/1, $425 - window AC, long-term renter (10+ years), smoker (nicotine staining)
B - 2/1, $550 - central HVAC (1987 AC, 2020 furnace)
C - 1/1, $395 - window AC

BestPlaces says the local area has 5% unemployment, with positive job growth of 2+%. Median home cost ~$125k, w/ 8+% appreciation past year. Renters are ~ 45% of local population, w/ $750+ median 2 bed rent, $625 1 bed rent. Major employers are related to healthcare, education, and manufacturing.

Was under contract for $120k, but buyer backed out due to roof cost. Now at $80k, as-is. My agent could not really find comps, but estimates $115-120k. Has been on the market a long time (over 3 months).

So, what say youse guys? :)

@Grant R.

I don't own a park yet, but am in the market to buy one. Based on everything I have seen from other owners, the COVID impact has been minimal, as mentioned by the gentlemen above.

I think part of it is due to the nature of their work. Most residents have jobs that are considered "essential". In large part, they are the stereotypical blue-collar workforce. Much of their work is stable, hands-on, and in-person. Trades like truck drivers, EMTs, welders, and so forth cannot yet be shipped overseas or done over a Zoom meeting.