All Forum Posts by: Bob Okenwa

@Michael L.

Adding square footage is one of the best, and most expensive ways to add value. If your property is a 3/1 and the neighborhood is full of 4/2's then you'd probably want to consider doing an addition. Additions make sense if they stick to what is natural to the neighborhood. Going from a 4/2 to a 5/3 isn't going to make as much a difference as a 3/1 to a 4/2 unless the neighborhood calls for it. Kitchen and baths sells homes as that is where all the shiny object reside. Light fixtures, plumbing fixtures, countertops, cabinets, etc. This is where you'd want to spend your money. Last but not least is landscaping. Here in the desert, lots of flippers just throw rock in the front yard and leave the backyard a hot mess whether it be dirt or dead grass and patches of dirt. Giving the homebuyer a completely new-looking home both inside and out can go a long way as long as you're not trying to turn quick flips into the Taj Mahal. Just stay in line with what the neighborhood aesthetic is and make sure everything LOOKS new even if it isn't new.

@Anurag Bhalla

Congrats on pulling the trigger. I'm from San Diego and would love to flip there but the prices are too astounding. To answer your question, you can look at apps/websites like Houzz and Pinterest for design ideas to see what's popular right now. An exercise I like to do is look at recently (last year or so) completed flips in the same general area as your property and try to do what they did if the property sold for a good price and sold relatively quickly of course. I personally wouldn't hire a designer as I think I have a decent eye for those kinds of things but to each their own. Also, HGTV is a source of inspiration for lots of home buyers these days and they tend to want to their new home to be like what they see on TV. All in all, design is more art than science. Even a paid pro can make mistakes. Unless the house has some kind of abnormal floor plan, I'd trust my instincts. 

@Ahmed Hasan

BLS does projections by industry and occupation growth, but not by individual city. You're going to have to do internet searches to piece together that information. You can search the BLS site for comparison of labor force from last year and this year but that's about as much as I've seen.

@Jason Young

By no means am I an expert in real estate, but have you considered using the BRRRR method to pull your equity out of the condo and use it for the next deal?

As for the LLC, it would be advisable to have one for the flips and one for the holds for tax purposes. Of course, you will need to speak with a CPA on this matter as tax laws and strategies vary for all of us in different areas.

@Tony Wooldridge

I'm looking to start with flipping then using that cash to transition into buy/hold. Read your post and thought a total tear-down for the 1st time up would have been about the best education a newbie can get, but the risks were too great and we didn't want to screw up our first deal. We're very happy just getting on base as of now let alone trying to hit a grand slam on the very 1st pitch. Thanks for the well-wishes. Keep us posted on future deals.

@Nate S.

Reface it if the market calls for it. A rental shouldn't be treated with as much design care as a flip. Most rental tenants will not pay you any extra rent for granite tops and high-end cabinetry unless you live in a high-end, high-rent part of town with luxury rentals nearby. As long as the frames are in decent shape, I'd reface them and go with the laminate counters. Before I owned my own home, I didn't care what the cabinets or counters were made of because ultimately they weren't mine. As long as they held my pots and pans and gave me a surface to prep food on, I was happy.

@Nick Kutschke

If you've paid them and have the statements and cashed checks to prove it, a faulty mechanics lien won't hold up when challenged as long as your payments were properly documented and not done in cash. That or you have signed lien waivers. But as Doug stated, fire him now and move on. This is a business and when people don't perform their jobs as expected, action must be taken. Same as any other job in America.

@Tony Wooldridge

The learning experience is well worth the effort. I just had a similar situation about a week ago on a property that was a total tear down from roof to floor. My business partners were wary of the deal after we walked the property and I still drew up the scope and estimated the rehab to be at 60k or so. The seller had another investor ready to buy and when he heard we were interested he upped his offer another 5k. The deal didn't make sense for us at anything past 60k so we were happy to pass but it was great to have a lead and follow up on it. Best of luck moving forward!

@Account Closed

Thanks for the reference. I'll definitely give them a call and see what they offer. Appreciate the plug.

@Timothy Maloney Thanks for the reply and great insight. I had a feeling credit unions were the way to go over the bigger banks. I understand we'll need to grow the business a bit before we get a significant LOC. If you lend in AZ that'd be helpful as well and you can PM me the details I'd take a look at that. Thanks again!