All Forum Posts by: Canesha Edwards

I was reading a book about real estate development that basically says land cost should ideally be 15% of project cost. . I’m sure these numbers fluctuate based on location and the type of development being built.

Can any one shed any light on the subject? Developers are you able to obtain land in today’s market at this percentage? Or are you spending more or less on land these days?

Thanks in Advance.

Canesha

@Scott Slocum

Scott, out of state investing can be a bit tricky. My best advice would be to spend a lot of time vetting and building a team in your desired markets. Ask for references in those markets for contractors, property management, brokers, etc. Once you have a good list, take some days off and set up in person interviews. It’s important to know what type of people you’re dealing with. Also, ask for names and numbers of current/past clients, call and get client reviews.

For property Management companies, read reviews from properties the company manages, see what the tenants have to say. You can learn a lot about a PM from their tenants.

It might take some time, but it’s worth it.

Just my 2 cents.

Hope this helps.

Canesha

Odyssey Property Group

@Sohil Vashi

I wouldn't invest at a 5% COC return. That's just my preference though.

I would see if I could nail down the rehab cost and see if the numbers changed.

@Sohil Vashi

Hello Sohil,

Few things, I would underwrite the loan at the current asking price just for underwriting purposes. Your offer price is not always the price you finally settle on. It’s good to underwrite different scenarios to see how the cash flow changes. Also, when I get rent estimates from rental websites, I always use a lesser rent estimate than what is provided. Just another way to be conservative in your underwriting.

Also, when I’m considering a property, I spend time in the neighborhood talking to neighbors ( they always have the best information). Visit the neighborhood at different times of the day.

As far as your rehab estimate, if you’re not too confident in estimating rehab cost, have a contractor walk the property with you. You never want to Over Rehab a Property. If there are other condos for sale in the same area, look and see what features/finishes are in the home? And how yours compares.

How do you plan to finance the property? Traditional financing, hard money?

Hope this helps.

Canesha

@Au Jia

Hello Au,

Congratulations on your syndication journey. This is something I hope to get into one day.

I know of a good lawyer who might be able to help. Shoot me a PM with your email, and I can get you connected.

@Nicole West

What makes you think it’s a good deal? What are the numbers? Is it in a good location? Do you have people in place to handle the rehab, property Management, etc? There seems to be a lot of questions you need to answer.

If you’re able, I would take a visit out to the property myself. As a beginner, I would recommending being involved as possible in the process.

@Chad Lawrence

Hey Chad,

If you have money saved for a down payment and plan to live in one of the units, look into FHA financing. You can get a FHA loan on up to 4 units. The down payment is typically 3.5%. If your credit score is 580 or less, then you might have to put 10% down. Hope this helps.

@Jared Abbott

Hello Jared,

I used Deal machine briefly. I believe the monthly price is too high. The app is pretty accurate in terms of recording addresses. However, enhanced searches ( provides phone numbers) or to sending mailers directly from the app cost an additional fee. If you have a decent size marketing budget, then the app might be a good fit. Just my two cents.

@Jillian Sidoti

Of course. It’s truly a great book with tons of information about the different regulations and how it affects raising money. Thanks for sharing your knowledge.

@Frank Patalano

Hey Frank, thanks for the advice. Which confirms that I’m on the right path, in offering to help other developers.