All Forum Posts by: Andy Sabisch

As VG said, leave it alone.  If you need to repair it, reside it and you are done.  The problem with asbestos is when you break it up and the fibers become airborne.  There is asbestos in many flooring, hot water pipe insulation, siding, etc.  As long as it stays in place, you are in no danger.  Tearing it up causes the problems which is why for flooring, going over it is the easiest and safest way to deal with it.  

Not to mention, residing will give the property a higher appearance and get you more money

The strictness of permit enforcement varies from town to town so your situation may vary.  Some areas are lax and others will nit pick you to death . . . we have seen and experienced both.

Not sure how the previous owner found a GC that did major renovations without pulling a permit but skipping town explains it.  Lesson learned for you to ensure a GC will pull permits.  We have had quotes for work where the GC gave us two prices  - one with and one without permits and for us, if he is willing to go the no permit route we keeping looking.  Not worth the potential hassle with the town or after the sale when an issue comes up and you did not pull permits.

As Elliot said, reach out to the town permitting official and explain the situation.  I would not be specific with the address as the city can red tag the property and then you and the seller are screwed.  Say you are looking at properties to renovate and if this issue comes up, what is the way to resolve it.

Either way it will cost you to correct even if you get another GC / contractor to come in as they hate to pick up someone else's work not knowing what was or was not done.

Quote from @Jerry V.:

Andy, so do y'all PAY each Contractor for asking/having them go out to each property you are looking at!? (unless you are giving them a ton of business, you SHOULD be paying them!)  Why don't you have your own Evaluator for doing this!?

 Jerry, I will say that we are not trying to scale to 10+ flips a month (or properties) and wearing out our welcome so to speak.  We know what we are looking for and when the property comes up that fits our criteria, we look at it.  We have done enough that we can gauge the condition of the big issues and if they are marginal, we reach out to the trades we use and get them to tell us where we are.  We are not calling them on every whim as wholesalers or beginners would but if we have it under contract, they are our inspection contingency to look at the property.  No different than a home inspector but we choose what professional assessment we need.  If the deal goes through (and 95% do), the person we called gets the work.  When we started, calling trades with no track record behind us did require paying for an assessment but we deal with the same small circle that know we are serious if we ask them to look at a property.

We avoid home inspectors like the plague . . . . the reports tend to scare buyers and result in demands that have derailed deals yet often miss the big hitters.  What we do is call the trades people we use that include a roofer, HVAC, foundation, electrican and plumber.  We may not call all of them based on what we see on walk through.  That way we get a true assessment not only of the issues but the costs as well that we can use to negotiate the price. In your report, the inspector says "get a professional to assess" - so why not skid the inspector and go right to the professional?  We do that and have great success with estimates and negotiations.

As far as the report itself, I would focus on the issues that will cost you and likely sooner than later.  The roof needs a professional assessment and estimate as that does not look good nor does the skylight.  Things like the dinged up siding . . . seriously?  As narrow as the driveway is, lucky that is not all that is damaged.  The flooring issues - plan on installing LVP and call it a day.  Figure $4 to $5 ft2 to get a ballpark estimate on cost.  The furnace . . . seems odd that he simply says 10-15 years old.  He can pull the exact date from the serial number and I would expect that as it is simple for anyone to do.  The window and door issues need to be corrected before they get worse - if you are paying to have it done, figure $2500 to be safe. 

Hope this helps

You will pay the taxes on the net profit when you sell it.  I'd you are living in it and plan to stay you can defer a large amount on sale of your primary residence.

Not familiar with this tool but there are several out there (do a search for software design tools) including several that are free or nominally priced.  Not sure if this will help with contractors understanding the work you want - I find talking to them and understanding what you want and they can provide is the best way to deal with more than basic renovations.

Looking at your profile it seems you are new to BP (not sure if you are new to flipping) - developing a relationship with a contractor and coming up with designs often does not require software to do it.  We have not used software as we know what designs work in the area, what is in demand and what the contractors in our network are capable of.

These are all good things to look for but the most important thing to avoid is over-improving a property.  You may have a house that knocks it out of the park but if the comps are coming in way under what you have, you have what no investor wants . . . . the most expensive house in the neighborhood.

Before you add these into your reno plan, make sure that they are additions that are seen in other properties and will not make your property the one that "looks cool but is way overpriced".

As others have said already, hard money is expensive money but it is easier to get especially when starting out.  You really need to ensure the costs to obtain and carry it are fully understood BEFORE you get into a deal and budget extra time to hold and see what it does to your projections.  

Shop around as the rates, amount they will loan and other costs vary and the one thing to remember, the less experience you have the more they will cost you.

Start reaching out to hard money lenders now to see what they need and what they want from you - it will vary especially with limited experience.  Waiting until you find a deal to start looking for a HML will often result in the deal going to someone that has done their homework.

You can get hard money fairly quickly but the cost can kill deals.  Hope this helps

Looking at your profile and activity on BP, it would appear that you are new to the flipping business and are looking for the hot markets to invest in.  Looking to do long distance flipping without a network in place is a sure fire way to not get off on the right foot.

We have done flips in several markets but always in markets we either lived or had contacts in to make sure the deal worked as we planned and even then there were surprises. 

If you do your homework, you can find deals that work for flips in any area you are in.  Start locally and learn the market you are in.  See what properties look like . . . photos can tell a heck of a story until you see it in person.  Trusting long distance GCs is often a mistake as they make money even if you don't.

So as far as your question, the best market is one you know and have the trades to get a flip done quickly and on budget.  You make money when you buy so find a property that will work and do it locally to get the process down

As Leo said, avoid the gurus and classes that promise to teach you the secrets in your market taught by people that have never done a deal in your market.  Unfortunately as there are more and more of these self-proclaimed experts posting their courses on social media hoping to snag students, there are more and more people that buy into it and then look for the solution to finding deals, pricing rehabs, finding comps and in the end, find themselves upside down wondering what happened. 

Bigger Pockets has a wealth of tools and contacts that can help you but you need to know your area before pulling the trigger.  While there are people that invest long distance, starting out that way will ensure you lose.  Find your local REIG and make contacts.  Most have members that will be open and share market-specific information.  Stop at Home Depot and Lowe's and talk to KNOWLEDGEABLE staff in various departments to get a feel for costs of both parts and labor.  See if they can recommend professionals that you can contact.  This business is a lot of relationship building and it does not happen overnight.  We have a range of trades people we can call and get immediate responses but when we started, we had none and got very few callbacks.

Trying to come up with a one number fits all is a non-starter.  See what you area calls for in terms of finishes.  Look at online listings and go to open houses.  See how long properties sit on the market at given prices.  Priced right, your property will sell . . . we have gotten properties under contract within 10 days even with the down turn in the market due to interest rates becuase we priced it right and made the profit we wanted.  On the other hand we have seen flips sitting for 6+ months and having multiple price drops . . . the carrying costs kill your profits.

We are here for you but get deep into your local market to get the knowledge you need to be successful . .  good luck