All Forum Posts by: Chris Shepard

We have used a lot of electricians. 

I can recommend Squire's Electric and Swich Electrical.  Joe at Squires runs a tight ship, and Chris at Swich knows his stuff.

hi David.  Please send me more info on your plex.

[email protected] 

Hi @Tony Ngo

We shy away from doing construction projects for other investors, unless it’s a turnover for a property management client.  So as far as managing a remodel for a fee, we don’t do that.  I would be happy to hear about what you’ve got going on and see if there’s any value that I could add. 

@Christopher Benjamin

Hey Chris,

I am a broker as well in Portland.  Congrats on finding an off Market deal!

I would be upfront and honest with the realtor.  He/she has been working for you and they work in a service industry.  I would compare it to not leaving a valet a tip... certainly not required, but a good thing to do.  

I would offer to pay him/her a flat fee (some where around .5 or .75% of the purchase price/ about the amount of a referral fee) to perform a few important tasks with and for you.  If you are getting a loan, if the realtor is good he should be able to wrap his 0.5% commission into the deal so you’ll only have to pay 25% of the commission in cash. 

Useful things that he could do are:

1.  Ensure you got a good deal by pulling comps. 

2.  Handle the contract and negotiations and make sure you have a 10 day inspection period and financing and appraisal contingencies if needed. 

3. Manage the inspection and the sellers disclosures and walk you through them so you understand the asset you are purchasing and generate a buyers repair addendum if repairs are needed. 

4.  If you’re getting loan assist with anything that might be required by the lender and appraiser. 

Good luck!!

@Jacob Wathen 

Hey Jacob,

Thanks for the response.  Our strategy is a long term hold strategy, so buy and hold is our main game.  

As far as sharing my knowledge, I really meant just sharing experiences that I’ve had that might benefit others. 

Right now specifically I am looking for a person to start out in a leasing agent position that would grow into other opportunities at our company. 

@Omid A.

I have a 3br/2ba about 2 miles from there that rents for $2995/m that is about 15 years old, but definitely very nice and in a little nicer area.   My guess is that a completely newly remodeled house would go anywhere from $2500 to $2800, but potentially as low as $2300. 

If it was negative cash flow, it’s not the end of the world.  I see single family homes as more appreciation plays.  Obviously we don’t want anything that is seriously negative cash flow, but if it’s $100 or $200 that will be made up over time as rents go up.  If I was looking for cash flow I’d be looking at multifamily properties. 

Hi Cynthia,

I think that I can best answer your questions by showing you a project that I am currently working on.

I recently purchased a 3br/2ba in a pretty nice neighborhood in Portland for $304,075.  We got a good deal on this property, other bidders had offered $330,000.  

We put our offer in originally at $311,000 with $5,000 of concessions, but we had an escalator clause (saying we'd pay $1000 more than anyone else, this generally works for us, if it gets crazy we can always back out during the inspection period, but I've never done that) which was accepted.  This put our starting number at $336,000 or net $331,000.

We then deducted my realtor commission of $8400 and then after the inspection period, we negotiated a $18625 seller concession due to the condition of the home.  

We purchased the home in "cash" (we used the credit lines that I've created with equity from our portfolio).  Here it is.

https://www.zillow.com/homedetails/6636-SW-32nd-Av...

One side of it is on a semi-busy street, a buyer would be very concerned with this, but an appraiser would not (because they operate by using a computer that pulls comps to make their job easy).  This is a very very big deal, because it allows you to get a much  higher after rehab appraisal value vs purchase price, than if you bought a house in the best neighborhood.

We plan to do about a $100,000 rehab and add about 550 sqft ( (enclose RV carport, and enclose deck on the north side and build a new deck, as well as remodel the whole house).

Once the house is done we expect the appraisal to come in at $500,000 or $550,000. I am trying to get my wife to move into this house with me so we can do an 80% LTV 30y fixed loan with a low interest rate, but otherwise I'd do a 30y fixed 75% LTV investment loan.

If it comes in at $550k and we get the 80% loan then we'd get 110% of our capital back. If it comes in at $500k and we do the 75% LTV we'd get 93.75% of capital back. The home would likely sell somewhere around $450k or $475k so it wouldn't be a good flip because there's just way too much risk there, but since we are not planning on selling the house it's a single or a double for us.

 I don't really use an equation... I always look for opportunities to add sqft and to create value that would be convincing and seen as valuable by an appraiser.

This is a very typical deal for us, we've done about 30 of these buying most of our homes on busy streets or near the highway or with bad parking. They make very good rentals, but are more difficult to sell.

Hope that answers your questions.

I'll see if my brother and I can make it to the happy hour!  We also own a brewery on the other side of town, Uptown Market.  

@Brian Bradley - if you're interested in meeting up, we are looking for a RE Focused Lawyer to partner with.

Cheers!

Hi Cynthia,

I would say that over the course of the 8 years we have been managing our portfolio, we have successfully pulled out 100% to %125 on half our deals, the other half we've gotten somewhere between 75% and 100%.  Our capital is locked up for about 5-6 months during each remodel and refinance.

I have been working full time as a REI Investor since 2009 and investing all of my income back into our portfolio. I don't take a salary and have been leveraging up by using the banks' and other peoples' money as much as possible. About 5 years ago we had a hunch that inflation would go up a lot (it hasn't) and made a plan to get as much low interest financing as possible. It was a decent strategy and hasn't hurt us.

I started out with about $150,000 and now share a multimillion dollar portfolio with my brother. 

We have a loan to value ratio of about 55% on our current portfolio which means that we have 45% equity.  

We have leveraged this equity with multiple credit lines which allows us to access cash when we need it.  

I am hoping to do my first 1031 exchange on the first property I ever bought (in 2007, yes a bad time to buy) which is in Arizona and I am looking for 10+ apartment complex so that I can create a large amount of cashflow.

The most difficult part of the whole strategy is running our property management company, which we are looking to grow.  Bringing on employees has been a very difficult but fruitful experience.

I am a real estate broker and I run a property management and construction company and own about 50-60 units with a focus on long term buy and hold strategy (BRRR).

We are looking for someone with an interest in real estate investment and who is interested in the buy and hold strategy to join our company starting out as a leasing agent. Here is a link to the position.

Real Estate Investment Position Available

If you know any young investors who are looking to start a career in Real Estate, this is a fantastic opportunity to jump into full time and learn from experienced investors.

Cheers!