All Forum Posts by: Brent Zande

@Frank S. This picture is not super helpful to answer your question but if I were to guess I would say you either have no flashing or older wood bevel flashing outside and the caulk has dried out. May just need caulked or flashed and caulked. The basement window could be similar issue with a lack of flashing at the deck to house juncture. Exterior photos would be great!

@Ben Clark

I would ask why it would even matter to you? When you place an offer it should always be what you dictate. Did they call for a highest and best? Stay clear and focused on your plan the rest is just noise.

@Toyosi Ogunkua. I am not at this stage of my career with investing but I took a great deal of interest in the same question as we began accumulating properties. One option that I find very attractive is called a Delaware Statutory Trust. These “syndications” are professionally managed real estate buildings or portfolios of differing types of real estate assets. A number of reputable firms set these up and you can 1031 exchange into them almost at any time. There is a minimum buy in and that may vary but these just kick off monthly amounts to you in proportion to your buy in. It allows you to sell each of your holdings at a peak. They typically hold the asset for 5-10 years so you are in it for that period and then there is a profit split when they sell. They will typically have their next buy in place so they can roll your money over again 1031 into the next holding. This can continue for as long as you like and you get paid with no tax on the exchanges and your heirs get it tax free when you pass. There are some downsides with fees and such so research completely but I was blown away by this option.

Hi Ben,

I am guessing very little difference to what you experience in TX.  There are about 4-5 attorneys in CLT that are good with understanding the nature of the assignment contract and how to account for it on the ALTA etc.  Basically the wholesaler gets the deal under contract, usually their own format contract and then they have us sign a contract at the price they want from us.  The seller is aware (this is critical) of what they are doing (not pricing) and on our side of the ALTA what shows up is the price we are paying and a fee to the wholesaler is on that ALTA.  The seller typically is not seeing this side of the ALTA and their side shows just what they are getting.  The attorney closes the deal and everybody walks with what they negotiated.  Hope that helps.  Brent

Investment Info:

Single-family residence fix & flip investment in Kings Mountain.

Purchase price: $65,000
Cash invested: $21,000
Sale price: $112,000

Found this home out after looking at another wholesale deal. Drove around the corner and this had windows boarded up but otherwise seemed to be in ok condition. Rehab took about a month and sold in 12 days and closed relatively quickly. Decent dollars per day of holding and a nice quick sale.

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

Speed of a decent return and our focus is flips of affordable housing.

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

Driving the community, clearly abandoned home. Reached out to owner and found they had this and 12 others to sell. They had a loan coming due so they were eager to sell. Working on buying the others but they do not seem as anxious on those.

How did you finance this deal?

Cash

How did you add value to the deal?

New windows, roof and update internal.

What was the outcome?

Quick flip for decent return and good return in dollars per day.

Lessons learned? Challenges?

Go under the house! We had a band sill that I missed and it cost more to fix at the end than it would have at the beginning.

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

Myself and a wholesaler friend that tracked down the owner for me.

Hi Robert, 

What kind of turnkey are you looking for in NC?

Brent

Jeremy,  Full disclosure I am a contractor In NC and a few other states so I am naturally biased but here are my 2 cents.  Mecklenburg County and its inspectors are on the look out for non-permitted work and they will shut you down if they catch it.  Then you just get a permit-not a big deal and really you might want to do it anyway because of your liability.  Killing a tenant because you didn't wire a light correctly is not covered by your insurance policy.    One issue that arises is if you plan on flipping it,  the appraisers and banks will need to see the permits issued to a licensed contractor if value increases over a certain mark in a short period of time.  As an unlicensed contractor (which is what you are) the NC Licensing Board for GC's will generally only fine you for doing work on other peoples property.  Unlicensed you have the same type of liability but the pressure is coming from your insurance coverage not a licensing board.  I do not recall ever seeing a case where they fined an owner doing work on their own property. I would suggest a chat with an insurance provider, not your own, because I think they will have concerns about owner rehabs without a license.

We work with several of these iBuyers in the Charlotte market performing rehabs for them.  They are very narrow in what they buy and rehab and they have all tried hard to limit rehab numbers as that is the hardest thing for them to control.  Their models are not really based on profit from the rehab and flip but rather to gain the "other services" like title, lending, etc.  They like the idea of escorting a client from one home into the next as the highest benefit to their business.  The good news for the local folks is that rehabs are tough for them to control on scale so they will avoid the rougher homes in the market, which are typically the ones our local clients make work.  I think it is a shaky model that really only works well in an upward trajectory market.  

Check into Corevest.  This is what they do.

Thanks J. Max I will look into that.