All Forum Posts by: Andy Sabisch

You might want to check out Simplisafe as their unit is self contained cellular.  You can get door / window sensors, motion detectors and even cameras.  Service is not bad in terms of cost and it is easily removed and moved to your next project.  They often have package deals or refurb units to save money.  We have used their systems on properties that are vacant as well as a storefront as a security system.  The nice thing about this system is that you only need power - no WiFi required as most other systems require.

Quote from @Tom Maurer:

This apartment is in a 20 unit that was built in 1979.  I don't think I have to worry about asbestos, right?

Tom

Take a look at this article . . . asbestos was banned in the late 70's but stock could be sold which put it into the 80s.  I would check using one of the test kits that you can pick up.

Another option is to use bleach in a spray bottle and let it sit.  You may still need to oil based primer to seal it.

Andy


https://www.mesotheliomahope.com/blog/how-can-you-tell-if-po...

There are a few solutions here.

First, consider removing the texture ceiling.  Spraying it with a water bottle and scraping in off with a 6-8 inch blade (the type to spread drywall mud), it will come off easily.  Since it could have asbestos, wear a mask and dispose of the material you remove.  Allow it to dry, touch up any spots that need it and repaint with ceiling paint.

The TSP option will wind up pulling your ceiling off anyway so I have not used TSP on ceilings - walls yes or ceilings that are drywall or plaster but not texture. The oil based Kilz (red can) is what we use on our projects to seal difficult areas.

Hope this helps

What you are asking is how to come up with the After Repair Value or ARV which is what you need to determine if a potential deal is a good one or a walk-away.


ARVs are simply best guesses in many cases albeit it an informed guess as no one has a perfect crystal ball. A 50 basis point uptick in interest can dry up the buyer pool that was there when you started your flip. A zoning change can do the same thing - increase or decrease the ARV.

Using sites like Redfin (if they serve your area) and even Realtor and Zillow will let you see what properties have sold for and are listed for in the area you are looking at. This is why long distance investing is a challenge as a few blocks in some areas can make a big difference in ARV. Even the specific property may drive the price in either direction . . . situated on the same block as a poorly maintained home / business or being across the street from a biker bar versus the best view in the neighborhood looking out over the mountains in the distance.  Be sure you are comparing apples to apples in terms of property size, reno status, etc.

Also, focus on recent SALES as property can be listed for anything but as they say, something is only worth what someone will pay you for it.

See if you can find a real estate agent in your area that works with investors and ask if they will run comps or a CMA on a property to get an ARV.

When you get the information from several sources and the ARVs are close, you know you are at least in the ballpark. If they are all over, you need to do more research. The other thing to be careful of is over renovating . . . you do not want to be the best (and most expensive) property in the area . . . you will sit on it until the buyer that really wants it comes along.

Hope this helps - Good luck

As Johann Villalvir said, ARVs are simply best guesses in many cases.  A 50 basis point uptick in interest can dry up the buyer pool that was there when you started your flip.  A zoning change can do the same thing - increase or decrease the ARV.  Using sites like Redfin (if they serve your area) and even Realtor and Zillow will let you see what properties have sold for and are listed for in the area you are looking at.  This is why long distance investing is a challenge as a few blocks in some areas can make a big difference in ARV.  Be sure you are comparing apples to apples in terms of property size, reno status, etc.  Also, focus on recent sales as property can be listed for anything but as they say, something is only worth what someone will pay you for it.  See if you can find a real estate agent in your area that works with investors and ask if they will run comps or a CMA on a property to get an ARV.  When you get the information from several sources and the ARVs are close, you know you are at least in the ballpark.  If they are all over, you need to do more research.  The other thing to be careful of is over renovating . . . you do not want to be the best (and most expensive) property in the area . . . you will sit on it until the buyer that really wants it comes along.  Good luck

Find your local REIG as well as any in the areas you are interested in and network.  I have found that members are willing to help new comers if you approach them the right way.  You may find members that are willing to help teach you teh ropes on one of their projects or that can partner with you with you bringing cash to the table.  Either way, it will get you to know who is doing deals and what areas are hotter than others.  You will also learn who you can call on for work when you get your first flip as getting a solid contractor team is essential to success especially if you are going to farm most of the work out . . . . Good luck!

As Chris said, novice (and some experienced) flippers expect the world and want to pay pennies.  They expect contractors to come over for an estimate and then don't get a contract or even a call back . .. until the next property needs an estimate to support an offer.  Contractors are in business to make a living and giving free estimates with no results makes many of them have a short fuse with flippers.  If you want to build a team, understand how they work and either work with them or find someone else . . . . a good team is worth its weight in gold so don't piss them off.

Unfortunately we are not in your area or I would love to have you tag along - great way to get exposure and experience.  Check with your local REIG and see if they can help you with going out on some flips . . . . good luck!

As Mike said, seller financed, bank financed or HML financed are all the same.  When you sell the property the loans are paid off and you pocket the difference.  It is also critical that you engage a title office to ensure you are getting a clean title and don't find out when you sell that the seller forgot to mention the other three loans he had against the property that now have to be cleared.  I would make sure it is clean BEFORE you start putting reno money into it so you are not left paying for work that you will never get paid back for.  Hate to have a house worth 150K and owe $180K on a great reno.

Congratulations on getting into real estate . . . . as far as your questions, I assume you will be holding the properties as rentals so that is how I will try to answer them.

1) Tax implications: The tax implications will be based on your income against expenses.  You can depreciate the property.  Best suggestion is to get an accountant that knows how to deal with real estate rental properties and you should be set.

2) As far as a wholesaler, there is no difference in terms of who is in the drivers seat.  If you want a contingency, make that clear to whomever you are dealing with be it a seller directly or a wholesaler.  They may want you to assume the contract they have with the seller and provide non refundable earnest money but be careful with wholesalers especially on your first deal.  Many over state the ARV and under state the reno costs leaving you in the red when you get into the project.  Finding a buy and hold with little reno from a wholesaler is harder then finding a flip.

3) As far as the ARV, do not go with what the seller or wholesaler tells you.  If yuo are using a HML, they will independently verify the ARV but you need to know where you are going into it.  If you know a real estate agent, see if they can run a CMA to get an idea on what the value of the property is after any reno is done.  Dialing that number in is key to your calculations to determine if the deal is worth chasing.

Hope this helps . . . reach out if we can help you further