All Forum Posts by: Brad Collins

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $129,000
Cash invested: $53,000

Contributors:
Julia Collins

SFH, 3 bed/2 bath, 1200 sqft, built in 1926.

Our first dive into the buy & hold rental world. A "light" fixer upper which wound up needing more than expected (as we should have expected). Lots of sweat equity went into this house to make the numbers "work", but that was the plan all along. In hind sight, it wasn't a screaming deal but it also wasn't a bad deal. A win for our first property!

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

As newbies, we gravitated towards SFHs in an area that we are familiar with. We knew we could bring some value in the form of sweat equity so a mid-level fixer-upper was on the priority list.

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

Walking the dogs in our neighborhood and noticed the For Sale sign and owners doing a little bit of landscaping. Started up a conversation and learned that they were now out of state and tired of managing the long distance rental. They gave us a tour an the snowball effect took over.

How did you finance this deal?

Conventional financing (25% down) for purchase and cash for the renovations.

How did you add value to the deal?

Put in a little sweat equity - remodeled the kitchen, master bath, and master bed rooms and fresh paint throughout. All new plumbing. Also gutted the overgrown backyard.

What was the outcome?

Unplanned expenses: Shoddy electrical. Flooding crawl space. General miscellaneous expenses (that added up fast).
Under/Over budget: Over by $5000 + future cost of crawl space repair (est. $5000)

Lessons learned? Challenges?

Don't skimp on due diligence. Better define the budget and add larger contingency. Get more creative with financing if we want to repeat the process more often. Don't pick the first house you stumble upon.

@Adam Schneider - I have not but putting it at the top of my reading list now!

@Stephen Diakos - That little extra bit of info really helped clear it up. Thank you for taking the time to reply!

Hello BP,

I have opted to use the Bigger Pockets lease agreement on my first rental property. I have been reviewing the lease thoroughly and there is one paragraph I don't exactly understand. It goes as follows: 

FEES FOR COMPLAINT FOR SUMMARY EJECTMENT AND OR MONEY OWED: In the event that Landlord determines it is necessary to file an action for summary ejectment and/or money owed, Tenant shall be responsible for the associated costs. Landlord may only charge one of the following fees against Tenant.

1. COMPLAINT FILING FEE: $ _______________________ OR ________% of rental payment, whichever is greater, and North Carolina law provides that no late fee for a Residential lease shall exceed fifteen ($15) dollars or five (5%) percent of the rental payment, whichever is greater; OR

1. COURT APPEARANCE FEE: __________________% of rental payment, and North Carolina law provides that landlord may charge a court-appearance fee in an amount equal to ten percent (10%) of the monthly rental payment.

1. SECOND TRIAL FEE: __________________% of rental payment, and North Carolina law provides that landlord may charge a second court-appearance fee in an amount equal to ten percent (10%) of the monthly rental payment.

So if I understand correctly, in the event I have to evict a tenant, I can only charge one of the fees listed above? If I put the maximum (5%, 10%, & 10% respectively), how in the world will I know which one to charge? Seems like they are effectively the same...

Also, the language seems a little redundant. Do I need the part that says "... and North Carolina law provides... ...equal to ten percent of the monthly rental payment."

Any reading you can point me towards would be much appreciated! Also... I learn well by examples... can someone help spell this out a bit better for me?

Thanks in advance!

-Brad

Hi @Lauren Hogan, this is a fantastic idea and I look forward to reading the posts that follow! Jason gave a perfect picture of North Carolina as a whole.

We just bought our first rental property here in Winston-Salem and the reason was quite simple - being that it was our first investment property, we wanted to buy something in a market we're familiar with. I have been here for 4 years now and have come to really love this little town. The downtown area is being revitalized, the hospitals provide some relatively steady/secure forms of employment for much of the area, Wake Forest is just up the street, and we're 2 hours from Asheville, an hour from Charlotte, and 4 hours from the beach. It's not a bad place to be!

We are using the landlord forms provided by Bigger Pockets as the starting point for our leases/application/pet addendum/etc. These are a fantastic resource and we're very grateful that they were included with the Pro membership!

My question is: What unique requirements have you added to your lease and why? 

Presumably, some of these have come about based on prior negative experiences with tenants. For example, I was listening to a past episode of the BP Podcast and the guest mentioned that they have a clause prohibiting political banners & signs after two tenants had a dispute over a large flag hanging from the porch.

Welcome to BP, @Lacey Dillon! My wife and I recently closed on our first investment property in Winston Salem and are excited to to grow our portfolio. Finding a lender who understood what we were trying to accomplish was one of the more stressful and parts of the process. Once we have this unit completed and rented, I will reach out to discuss financing for future deals and the potential to refinance our current property (BRRRR)!

@Cole Oraham Thanks!

Hello Bigger Pockets world! I figured it’s time I make my first post.

I joined the BP community after listening to a couple podcasts and realizing how much I had to learn - and how much BP had to offer. We had just closed on our first investment property here in Winston Salem, NC (you can read a bit about it on my profile). Fast forward a couple months and we’re wrapping up the renovations and working to get it rented out. Exciting times and we cannot wait for the next one!

If you’re local to this market, I’d love to chat. I’m also looking for any meetups that might already exist. The podcast goes a long way to teach and motivate me but its always nice to meet others doing the same thing in Winston!

A bit about me:

Grew up in Atlanta, GA. Went to Clemson to become a mechanical engineer - Go Tigers! Worked out of Atlanta for a couple years before quitting and moving to Fort Collins, CO to live the “front range ski bum” life. After a couple years and a cross-country cycling trip with Bike & Build, I moved to Winston Salem in 2016 to be with the love of my life!

Hobbies include road & mountain biking, skiing (writing this post from the Denver Airport!), DIY home renovations, attempting to stay fit, most anything outdoors, and now, real estate investing!

Cheers,

Brad

Hi @Brandon Belk,

I happened to stumble on your post while searching for other investors in the local Winston Salem area. I myself am relatively new to real estate investing. My wife and I just purchased our first rental property - a SFH fixer-upper here in Winston Salem. We're certainly putting some sweat equity into this deal but it's been exciting knowing that we're finally making moves and learning along the way.

If you ever have any interest in meeting up for a beer & a quick chat, please reach out! I'm always looking to meet folks who are excited about the power of real estate and can relate to all the BP podcasts I've been listening to lately.

Best of luck in your future endeavors!

Brad