All Forum Posts by: Chris Svendsen

Welcome. Lots of decisions to make. Northern VA is expensive but little farther out still possible deals exist. I have gone to a couple meet ups with other investors out in,winchester area and you more than welcome to attend next one when we get it organized.

As for where and What to invest in is tough and the how.  Need to decide what your long term goals are, how much you want to be involved, assets you want to be involved in, etc. 

Plenty of great people here to help.  Come on to a meet up some time it is a great experience seeing how others invest.  May change your thoughts.

thanks Patrick.  I was thinking about this all night last night. There are a few hurtles to overcome to make this a reality.  Town does have specific student housing zoning and must be approved for this to work.  To make this happen I will also need to purchase a vacant lot across street to allow for necessary parking and get property zoned correctly but if that all happens then I have a killer deal on my hands.  After reading codes came across even better news, I can have up to 5 students in a unit so increases profits even better.  

I think I am going to put in two offers.  One cash that I can afford to loose completely as is a possibility so will be extremely low and one more realistic but contingent on zoning approval.  Hopefully others will chime in but I keep thinking brand new houses, high yearly income and low upkeep and management fees, just can't go wrong.  

Today my wife, our contractor/partner, and myself went to evaluate a few properties to make into student rentals.  Wife and contractor loved a couple single family home to make into rentals and each one can bring in about $12k a year in income however I see the wisdom in large scale.

We looked at a 5 unit row home property, currently has 15 bedrooms and 10 bathrooms but ability to go to 20 bedrooms and 15 bathrooms easily.  Problem is the propety is qoing to requrie a down to the frames renovation.  Currently it is in unlivable condition, has water coming in from roof but the structure is solid for most part, foundation is mostly good besides on corner.  

The propety needs new roof-probably structure too that makes the roof, all windows and doors, and full interior redone from studs up-electric, plumbing, gas lines, drains, etc-Literally building new houses inside existing shell.  However there are things that scare my contractor off and the wife.

First is foundation on one corner has a tree growing out of it, which is old stone wall foundation.  Will require digging out tree, shore up that side of house, build new foundation under it.  Estimate that to be upwards of $25-30k.  Second is no current fire walls and contractor thinks city will require adding this to propety.  How bad is this really to do.  Contractor is not going to be doing work as to large of project for him but to me I don't see that being to bad to add, especially since units are going to be completely gutted to the studs.  My mind is not a big deal, just add it in but he thinks just a money pit.  All in he estimates total repairs to be $200-$250k, but I figuring $300k to be safe.  Asking price for property is $100,000 but is in bankrupcy and estate sale fiasco.  

The good, if I can get approved for student housing, rents would be at least $350 a bed on low end, high end in area is $600 a bed.  Agent thinks could get $400-450 a bed.  At $350 a bed times 20 bedrooms that is $7000 a month, 10 month leases brings in $70,000 a year.  To me this is a no brainer and worth the investment but everyone around me thinks I am crazy.  Agent thinks propety value is around $10,000 the way it sits but said the ownership is a mess and not sure if it will ever sell. He think eventually city will just tear down after another 10 years or so.  

From people with experience in this matters, am I crazy to think this is a good opportunity?  Exterior shell and structure of units and foundations is faily intact as a whole.  I had 2 schools of thought. One was to make a low cash offer not contingent on zoning.  Another offer at a higher cash price contingent on zoning approval for student housing.  If didn't get approved for student housing rents would only be about $650-700 a unit, so yearly income would only $39,000 to $42,000 a year which make things much less appealing.  Still lots of things to overcome to make a student rental but at $70,000 a year on the low end and having  a max invested in property of $400,000 I still think it is a amazing investment option.  If we put all money back into paying off renovation we would have large cash flowing property in less than 7 years.  What do you all think? 

Oh, lastly the city is offering a $16k cash towards making propety lead free which should help with some of the cost.  This could bring in $80k to help cover renovation expenses.  Am I just surrounded by people to scared to a chance or do I have some beer goggles on here?  Also, any idea of what I could do for financing the repairs of property?

Welcome.  There is a massive amount of information and helpful people on here.  You are in good hands and will find all the help you need from this site.  

@Emily Howlett @Ed McMahon maybe this will be of interest for you to attend.  Be great to get some more people out to these.  

County makes all the rules and if you don't play by their rules, they take the ball away.  I renovated a single family home, permits, inspections and at the last final inspection the inspector wanted to fail me for door opening going into the bedroom becasue it wasn't up to current codes.  After about 20 minutes of spirited discussions, point out all permitted plans showed the door the size it was, and that the house was built in 1877 and to make the door larger I woudl have to remove a window and restructure one wall of the home, he relented and signed off.  Goes to show at times you are at the inspectors mercy.  

Instead of renting out space as an apartment and having to add sprinklers to property can you use it some other way to bring in revenue?  Convert to storage for other five untis for a small montly fee increase, on site laundry, possible office space for you, etc? Just ideas.  

I would get a cost of the sprinkler system install and figure out from there but apply for temporary permission to get power back on to the property or find some other means on how to get hot water for building or your going to have a host of other problems.  I would do your best to work with the inspector.  Also, maybe contact old owner of property to see if 6th unit addition was permitted and maybe can get blessing under the fact that it can be grandfathered in and not need to do sprinkler system.  Good luck

Keyscan, DMP, Alarm.com, Honeywell, Brivo, and others all have commercial door access system based on keyfob solutions.  Alarm.com is a new player to the market who has a excellent cloud based system which has a lot of bang for the buck, can intergrate camera systems, energy management, and security all under one platform and easy to manage from anywhere in the world being cloud based.  Contact a commercial security professional in your area of the property and start there. Biggest thing is someone who can support your system in event something doesn't  work as it should.   Sometimes the smaller local companies for yoru area may be best as opposed to the national players too.  Keyfobs is the best way to go plus can remove access to some amenities if fail to pay dues, say the exercise room, the laundry room, pool, etc.

Sorry cannot figure out how to rotate photos.  

We rehab a log home, exposed logs inside and siding on outside.  Other than being an old house everything was basically the same for us, but log wall were in good shape so we had a leg up on things.  If Exterior wall are in good shape I would go for it.  If not in good shape it may be best to pass up on it.  

My current tenants fall under this same situation almost exactly.  Going on month 5 without a single missed payment and been great tenants.  If they have good income and check out other ways I would take the chance on them, especially being so young it is not a surprise they have no credit history.