All Forum Posts by: Rob King

@Isi Nau I agree, there is real growth potential in the west side esp with the push towards greater infrastructure spending to make Kapolei a true second city.

I invest in town because I know town and I identified the market I feel confident in operating in but wherever you feel you can identify a market that is aligned with your goals do as Isi says and looks towards purchasing sooner than later.

@David Valladares you can totally house hack on Oahu, I did it for 2 properties in town and now they are BRRRRs. It's a tough market but when you make it work you look like a genius.

@Ryan Weimer. Thanks for the knowledge

@Ryan Weimer sounds like a great return, well done! Forgive my ignorance but what is wholetail?

@Donald Hodge

I invest in Makiki condos just outside of Manoa valley and feel very confident you would be able to get 2,400 for a 2/1 if its reasonably sized and maintained. I have two 2/1s in a rougher area of the city that I rent for 2k and 2.1k without any issues at all.

I hope the property turns out well and you're able to capitalize on the ADU. All the best!

Makaha, as already mentioned, is as far away from Honolulu as one gets on Oahu and the rental market is not very strong out there due to poor city planning means few jobs for young professionals and the inadequate roadway limits its appeal to commuters who want to work in the rapidly expanding town/city of Kapolei.  If you're looking for a part time rental that you could also use for personal stays I would suggest looking towards Ewa Beach, perhaps Iroquois Point, which is reasonably priced and close enough to hospitals in Kapolei to allow for short term rentals to traveling medical professionals. 

Another reason for purchasing near Ewa/Kapolei will be the rail project, that once completed should increase the attractiveness of the area to commuters who are currently turned off by H-1 traffic.

Investment Info:

Other buy & hold investment in Honolulu.

Purchase price: $316,000
Cash invested: $9,500

Foreclosure bought at auction through Hubzu which was a new experience. The property was in rough shape and the bank was terrible to work with but their lack of interest in the property worked to my advantage in the end.

2BR/1B condo in a mid-income area. I knew the building through a coworker and bid sight unseen. Using a strategy I used on my first reno I rented 1BR to a student below market with the understanding that while she was living their the property would get better.

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

After gaining confidence with my first property I was able to design a Buy and Hold strategy that worked for me and fit my market. I know the area and through a work connection I knew the building better than other bidders.

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

I found this deal using Hubzu and bid on the property.

How did you finance this deal?

Traditional 30yr fixed

How did you add value to the deal?

First I knew that the units included an on-site storage locker which was not referenced in the REOs paperwork though I was able to positively secure ownership through research and working closely with my agent. Immediately after moving in I removed an illegal modification, refinished the cabinets, installed new flooring, and painted the property.

What was the outcome?

The property was my primary residence until I located another unit, within the same building, that I wanted to purchase and will now rent this property. Finishing touches and updates are being completed with the rental to hit the market this month (Feb 2020)

Lessons learned? Challenges?

Learn the fine print of bidding on an REO and the fees associated with such activity. The deal was completed in October but the bank dragged its feet until January 3rd so that they could write it off as a loss for the following year.

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

My agent was fantastic, I had worked with her before and was very satisfied with how she handled this deal.

Investment Info:

Other buy & hold investment in Honolulu.

Purchase price: $316,000
Cash invested: $9,500

Foreclosure bought at auction through Hubzu which was a new experience for me. The property was in rough shape and the California bank that held the REO was terrible to work with but their lack of interest in the property worked to my advantage in the end.

2 bedroom, 1 bath condo in a middle income area. I knew the building through a coworker and had worked in several fail-safes into the purchase contract since I bid on the property sight unseen. The condo needed immediate work to make it liveable but it was largely cosmetic. Using a strategy I had developed on my first condo renovation I rented out one bedroom to a graduate student below market with the understanding that while she was living their the property would get better but her rent would not increase. This is a successful strategy when affordable housing is difficult to find esp if you have something that seperates you from the rest of the market (in this case the property allows pets).

Recently bought a second unit in the same building so this REO purchase is getting some final retouches and then will be on the market to rent by the end of Feb 2020.

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

After gaining confidence with my first property I was able to design a Buy and Hold strategy that worked for me and fit my market. I know the area and through a work connection I knew the building better than other bidders.

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

I found this deal using Hubzu and bid on the property.

How did you finance this deal?

Traditional 30yr fixed

How did you add value to the deal?

First I knew that the units included an on-site storage locker which was not referenced in the REOs paperwork though I was able to positively secure ownership through research and working closely with my agent. Immediately after moving in I removed an illegal modification, refinished the cabinets, installed new flooring, and painted the property.

What was the outcome?

The property was my primary residence until I located another unit, within the same building, that I wanted to purchase and will now rent this property. Finishing touches and updates are being completed with the rental to hit the market this month (Feb 2020)

Lessons learned? Challenges?

Learn the fine print of bidding on an REO and the fees associated with such activity. The deal was completed in October but the bank dragged its feet until January 3rd so that they could write it off as a loss for the following year.

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

My agent was fantastic, I had worked with her before and was very satisfied with how she handled this deal.

Scott, hopefully in the past 13 years you have found a quality agent for the Honolulu market but in case you are still interested in the market I have recently completed a few purchases in the Makiki area with two agents out here and had an excellent experience with both.

The first agent is pretty seasoned and assisted in the purchase of two condos, one was an estate sale with the family off island and the second was a foreclosure auction, sight unseen. She did an excellent job and I felt comfortable using her services.

In December of 2019 my primary agent, described above, was traveling when a deal became available so I used my second realtor for the first time and she did a phenomenal job. She and her husband are also real estate investors who knew the market and she blew me away with her ability to negotiate the price down from an unrealistic seller who had an emotional connection to an estate sale.

I purchase middle class condos for BRRRR purposes but both of these agents have also worked single family and luxury properties as well. Please feel free to reach out with any questions.

- Rob

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $285,000
Cash invested: $65,000

2/1 fixer upper condo in a lower middle class neighborhood within walking distance to a highly regarding private school, hospital, and the largest university in the state. The property was well maintained but dated and was purchased from an estate. Slowly renovated the property myself to develop into a rental income property for a long term buy and hold strategy before I had a concrete plan in mind. Excellent learning property that provides some positive cash flow and easy management.

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

This was my first property and I felt I could live ugly, fix it myself, and increase the value of the home to later sell and roll profit into a more expensive property. After making several renovations and learning more about the rental market in the neighborhood I decided I would change my strategy and make this a buy and hold property.

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

Found through a realtor and made an aggressive move since I felt the estate, located thousands of miles away, would like a quick sale which they did.

How did you finance this deal?

Traditional financing

How did you add value to the deal?

To add value to the property I compared the cost of contracting various jobs against my confidence that I could learn to do the jobs myself with multiple do-overs for less. A near total renovation including flooring, lighting, outside of wall plumbing, and paint significantly improved the livability of the home and the prospective rental income. In addition to adding income I took pains to reduce expenses such as changing building management to reduce monthly costs.

What was the outcome?

The property is an excellent rental that generates some cash flow, builds equity, and is easy to maintain. As an advocate for middle-class rentals I didn't over-improve but focused on durable and classic improvements that transition well between tenants. The property's location and improvements have lead to finding quality tenants.

Lessons learned? Challenges?

The biggest lesson learned was be open to adjusting your plan when the circumstances present a better opportunity. I did not plan on being a real estate investor but after reading the writing on the wall I changed my initial plan. I missed an opportunity early by accepting the costs of the management instead of challenging their status quo, had I committed to that fight earlier I would have saved thousands of dollars.

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

I have a realtor that is excellent, aggressive, and bluntly honest. I identified value beyond my purchase by being a member of a small community that places high value on word of mouth recommendations and trust, since doing business with her 4 of my coworkers have bought through her in as many years and I bought a second property with her. Locate an expert and add value to their business so that you can grow together.