All Forum Posts by: N/A N/A

I should have read you blog first....

How about them numbers.

What was the purchase price?
What is the ARV
What is your rehab budget?
Hpw long for the rehab?
Going to FSBO or sell with realtor?

Inquiring minds want to know. Well, I do anyway.

To start with, you said something in the video that bothered me. When outside, you noticed something on the chimney as said something like 'it may need a roof. We will have to buy it then get up there and see if it needs a new roof'.

I would strongly suggest you determine if it needs a new roof BEFORE you buy the house and that you do a more thorough inspection to see if you will need to replace the decking. You are looking at several thousand dollars for a roof so it is not something to shrug off.

Then you were commenting on the flooring and which way to go. What you have is parquet flooring which I personally hate. You can probably put carpet right over the flooring for the most cost effective approach.

And then their are the windows. They seemed to be single paned sliders. Is that typical for the neighborhood? Upgraded windows may be a big selling point and you can get those for a couple hundred each, installed. Something to consider.

Beyond that , it is very difficult to determine the complexity of the project without knowing more about the house and the neighborhood. Your competition will determine what needs to be done to the house. If others in the area all have new windows, hardwoods, and solid surface counters then you need to do the same.

What are the numbers, comps and asking price?

Lets put together a quick list

Exterior

Roof? How old is the roof. Even if it is not leaking it may be at the end of its serviceable life which will make the house harder to sell. Any water spots on ceilings?
Gutters? Cheap to replace and makes a world of difference
Exterior repairs. You pointed those out
Exterior pressure washing. Every rehabber should own an uber pressure washer and know how to use it
Repointing brinks? I noticed you pointed out the bricks but condition was hard to determine in video
Exterior paint. Looks like a given.
Garage Doors? They always seem to be a problem.
Exterior doors? They also always seem to be a problem
Exterior lighting. Cheap but helps with curb appeal
Landscaping
Decking?
Driveway condition?
A/C unit/compressor/condenser/whatever. I hate to say this but appearance matters. A rusty banged up unit will turn a buyer off.

Interior
Kitchen. Looked rough but hard to tell condition. Paint cabinets, new counters and backsplash, appliances at minimum. Flooring?
Bathrooms. Guessing the need updated as well. Would you buy the house with the current bathryooms?
Paint. Way time consuming
Flooring. Already discussed but what does competition have?
Lighting/fixtures/fittings. Replace all
Electric service?
Plumbing? Copper/polybute/PVC?
HVAC?
Interior doors? new hinges and knobs at least.
Basement? Dry? Finished?

All in all that seems to be a decent house but most people do not really understand how much work even just cosmetics can be. Who is going to do the work? Its not all hard work but it can be very time consuming. You would be suprised how long it take to replace all outlets, switches, and cover plates in a single room as an example. Easy work but a couple hours per room can add up. Painting is also easy but can take forever with all the cutting in and trim. Anyway, I am having a case of insomnia so pardon the rambling post.

Its all about the numbers.

Anyway, I am having a case of insomnia so pardon the rambling post.

Close, but it cannot be used to purchase a house to be sold. The 203k program is only available for owner occupied properties.

It usually takes them a few weeks to process the paperwork but the property will wind up with a realtor. Most banks cannot and will not work directly with buyers.

http://www.banking.us.hsbc.com/HICServlet?cmd_PropertySearchDefault=cmd_PropertySearchDefault

I dont see any listing for NC and if you read their site they always direct you to the local agent.

Granite is considered to be a higher quality and demands a higher price at retail but, and this is a big but, what are the installing or what is installed in competing properties. No sense spending the money on granite if every other house on the street has laminate. Don't over rehab if you dont have to.

1-800-Got-Junk

In the MLS you can search for properties with special circumstances but most sites outside the MLS do not have this feature. Find a site that permits keyword search and look for foreclosure, corporate owner, fixer, and estate and you should get a fairly good list of both bank owned and distressed properties

1. Financing - It seems my best bet is a hard money loan as I have almost no cash to begin with? Would that be right? I have good credit and can refi several months into the project.

Hard money is the easy way to go but do not kid yourself, you will still need to have some cash to cover carrying costs and other expenses not covered by the HML. Sit down with the lender and have them walk you through the process and discuss what is and what is not covered in the loan. You will also want to look into construction to perm loans. Many banks will also let you use this type of loan for a rehab. The rates tend to be much better and some will even set aside the monthly payments as part of the loan to reduce your out of pocket expenses. You many also want to look into subject to deals to avoid loans all together.

2. What's the best way to find rehab property? I know a sharp realtor, but I have not asked her what her expertise is with investment properties, or whether I should even enlist her help here, if there are better avenues?
Sorry if these are dumb questions, but I'm starting out and don't really have a clue. Any advice is greatly appreciated-

You are going to get your best deals buying directly from the homeowner though advertisements, bandits signs, pre-foreclosure mailings, etc... They just want out and will probably be your best source of deals. Once a house hits the MLS then every investor for 50 miles has access to it and will either have made an offer or passed on it. You have to ask why, if its still on the market a few weeks later. Whats wrong and what do the others know. Bank owned houses on the MLS either go right away (good deals) or sit for months (overpriced or need a ton of work). You can also look at local wholesalers but be careful as many tend to overstate ARV or underestimate repair estimates.

Excellent point Pixel.

I thought this was a real estate investing site? Why would anyone offer or advocate offering anything more than is absolutely necessary to obtain an investment property? If you are dealing with REO's you will know that most banks request 1k EM and will take 500 but there are a few that want 1-2% but thats it. A motivated seller should not give you any hassle about at $10-$250 EM offer, if they do then maybe they are not motivated enough.

Keep your money in the bank.

That depends on the final contract and the terms of said contract. On the Georgia GAR form you can right to terminate which means you do not lose the EM. And generally You will also receive your funds if you terminate due to property condition or inspection results. But they can fight it so...

There is no reason to ever put 15k earnest money on any house.