All Forum Posts by: Brent Zande

Stan,

 The model looks good.  We acquired about 115  properties in Winston for Invitation Homes and we struggled a bit with the rents there.  I think it could  be a bit too optimistic in getting a house for 100k total investment and renting it for $1200.  The other thing you should raise a bit is the Repairs and Maintenance, do you think you will turn it every two years or three to a new tenant.  If you think its every year then the R&M should be closer to $3000.  Your turn costs will eat you alive.  I did not see any marketing expense in the model for the re tenancy. I would like a copy of the model if you could share it via PM.   Be happy to discuss my experience there and overall with the private equity firms.

Brent

Matt, Todd and Evan,

I am the COO of R2Resi, which is the SF resi platform for RiverRock Capital Partners. We are actively investing in Atlanta and I would love to hear what you have going on in the area. Thank you Brent Zande

To Chad,

No, the banks aren't giving me the leads. I follow some properties I want from preforeclosure through the foresclosure at the courthouse and verified that the bank got it back. Then i will call that bank within a day or two and inquire if i can buy that house and save them the 6% commission. The small local banks will play ball sometimes and I do all the work for them. I make a list of repairs and costs and include that as a cover letter in my contract.
Ryan, yes you have to go find out who the bank has as the lead on foreclosures, sometimes it is the bank president if the bank is small enough. Then only call about that property that you know they just got back. Most of the small banks would rather not let it go through the system if they can sell it in 24 to 48 hours of getting it back. All cash deals seems to make it happen more.
Never works with large banks.
Brent

Would it not be simple to add a clause in your offer stating that your offer is withdrawn if another short sale offer is accepted first. We have done this and it seems to be well understood and it creates urgency and gives no time frame for withdraw. If an offer is accepted then we simply call or email the other brokers and let them know that someone else beat them to the deal.

The quality varies on the appraisers for sure. The desk appraisal is cheaper because they don't actually go to look at the property. You could do what Bill suggests, but what is your time worth in that scenario. I would guess each realtor will soak up an hour of your time, so I think the appraisal money is well spent.

Kama, In this area I would really recommend you pay an appraiser to do a desk appraisal. Usually, around $100. There are just too many variables for most realtors to give you a real number to use.

It has always been beneficial for us to stage the homes and then get the pictures. If they are coming in and touring the home then the price isn't too far off, but the home isn't living up to it. Staging can overcome a great deal and will help you sell faster.

In Charlotte the realtors all think things are improving and that is probably true, but I feel it is more just the seasonal cycle that is here again. Things always sell better at this time of year. A very minor uptick has happened, but we have a ton of foreclosures that have not begun to come onto the market.

This would have been a very attractive deal had you been able to put it together. I would suggest spending the money for a desk appraisal for the after repairs value and getting 2 contractor quotes. You are asking the rehabber to pay you for the deal, make it easy for that person to fully trust that its a deal and do that work yourself. It makes our lives easier and does get us writing checks. Good luck

Actually, the 35% you are plugging in is a very strong number. Of course its area specific, but looks strong to me. There is a fine balance here, that if you are too aggressive you will never get a seller hooked and if you aren't aggressive enough there isn't much for the rehabber to get excited about. I am happy to make 20% after all expenses are paid. the biggest thing for me to buy from you is prove your numbers-is the $260,000 a appraisal or just a BPO. Is the repairs number a quote from a contractor or 2 or just a guess. Once proved out this looks like a good deal. Plus, I think only 3-5k for getting this good of a deal is too low. $7500 minimum.