All Forum Posts by: Ashley Wolfe

Hello Darryl,

Nice to see you on the forums.  Thanks for the introduction and letting us know about your experience and services.

Ashley Wolfe

Can we do an example with simple numbers so I understand? (Please note, I'm so new at this that some of these figures such as wholesaler fee, potential repairs and holding costs are completely made up by me.  If there is a more realistic figure, by all means, correct me if I'm wrong.)

ARV on a home is $100,000

$100,000 * .65 (65% rule) = $65,000

$65,000 - $3,000 potential wholesaler fee = $62,000

$62,000 - $20,000 in potential repairs = $42,000

$42,000 - $4,000 in potential holding costs = $39,000 MAO

Potential gross profits $61,000/2=$30,500 for myself and contractor

I know this is full of holes and may not even be in the right universe as an actual breakdown.  But, hey, this is why I'm here asking all these greener than green questions.  Thank you for your input.

This is what I'm thinking and I may be misinterpreting so I know I need to come with more questions to the person I'm emailing. Because I'm looking to work with a reputable GC who can take care of subs and complete cosmetic rehabs on time and within budget I'm willing to do a JV like the 50/50 split idea. But if I'm also paying an agent/wholesaler or marketing costs to develop leads or relationships to keep the opportunities coming in, then that is taken out of the gross profit before its split as a payout to myself and the contractor (if a 50/50 split).

I feel a bit vulnerable since I'm so new at this.  I don't want to get screwed over by a contractor that knows I'll be confused with all the details and nuances of the flipping and real estate business.  I guess that is where having an attorney really helps. 

What type of attorney do I need to be looking for?

Its great to know that this is a possible structure and that it works well for you.

 I'm understanding more now and I agree that people who do quality work and do every aspect of the work should be paid accordingly then should be given more jobs in the future.  So 50/50 means that they do not invest their capital into the project but their time, expertise, work and project management.  When the deal is closed, they get paid half of the net profits in addition to my repair costs?

I think I know the answer to this next question but don't want to assume.  Do GCs appreciate the rehabs where there is a list of materials with price, timeline and SKU# that has already been used for past rehabs?  In other words, a cookie-cutter rehab?  I know every rehab is different and there could be a rotting sub-floor waiting to be discovered that will change the price and thus the profits.  But does a systemized, repeatable cosmetic rehab system save stress for the contractor?  Would a contractor be willing to help me create these systems you think?

Y'all have been more than helpful.  I know that, without an amazing contractor, I can kiss my house flipping dreams goodbye.  I just want to be an equally amazing investor to work with so the relationship can be mutually beneficial for years to come.

What would a good line of questioning be for capital contribution (and what is that exactly)?

I feel like I need to interview companies like this, even if they are rated highly and have great reviews. 

Great lessons and scenarios that help me learn more about investing, as I have not done my first deal.

How do you go about getting inheritance/probate information?  Thank you!

I just emailed a remodeling company asking if they act as GCs on house rehab projects.  They come highly recommended and are a Five Star Rated (by Home Services Review) company. 

My email said, "I'm a RE investor in the area and I'm actively trying to form my rehab team for the winter season. I'm looking for a company to work with that will provide me with one point of contact for 100% of the cosmetic rehab of the properties I purchase. Since I don't have time to interview GCs, I'd like to know that SOWs will be managed and executed on time without me having to manage assorted sub-contractors at different properties.  Would you be able to work with me in this way?"

Their response was, "Sure we can be single point of contact with hundreds of resources at our disposal to handle a large array projects on time. 50/50 partners is our acceptance." 

What does that last sentence mean?  I'm not sure if that's contracting lingo or not.  Thanks!

Ashley Wolfe

 Thank you so much for your advice.  In June/July we had the price at $130k and got an offer that fell through.  Our current price is $115K.  Should we cut another $5K off and see if it sells?

Would this be a good first deal in being a landlord or should we get something closer to home (which is currently a direction we are exploring)?

Thanks again.

Hello all,

I need to know how to go about analyzing an inherited townhome to see if it would be a good rental.  

The quick story is my husband's mother passed away in late May and we inherited her townhome.  She owes about $70K on it and it hasn't sold after being on the market since June.  She took good care of the house so, to our limited knowledge (because we are in TX and the property is in PA) there is nothing glaringly wrong with the home.

We need to know the steps or components of analyzing this property to see if it would cash flow after all expenses are paid, including property management since we are out of state.  Is there a formula to follow for creating the monthly rent?  

Its bittersweet thinking this may be our first deal, but I also want to know that we won't be hopping off a sinking ship.  If you have any words of wisdom or spreadsheets that you use to analyze deals to become rentals, I'd love to know how to do this the smart way.

Thanks in advance.

Ashley Wolfe