All Forum Posts by: Christopher Phillips

@Barb F.

Never get emotional about investment properties. The numbers work or they don't. Appraisers know what they are doing. Don't try to outguess them. Don't overpay for a property. Don't do work on a property that you don't own. Most REO deals fall apart.

Shortsales are never used as comps. Their prices are meaningless.

REOs can only be compared to regular sales if the condition adjustments are made. Ideally, 1 REO, 1 regular average condition sale and 1 updated sale. Same for Active/Under Contract.

Bathrooms are $10k each (for full) $25K to $35K+ for kitchens depending on the size. Floors are about $800 to $1,000 per full sized room.

You have to get a contractor to walk through the property to give you real estimates. Don't make offers based on guess work. And assume for 10% budget overrun. 

Since you are going to live in the house, you need to look at the cash flow and see if it still makes sense at a higher price.

@Josh Vernon

There isn't anything behind rates. Mortgage rates are based on supply and demand. You can't point to any economic indicator and back into rates. Rates are purely based on individual institutions and how they want to advertise for the best borrowers.

 Use Bankrate.com. They aggregate bank rates

@Tony Marcelle

Google.

Housing grants or down payment help is very local.

There are some state level, town/city level or county level type programs. You have to search for them.

Some of the programs do allow for 1-4 family purchases as long as you plan to live in one of the units for a certain amount of time. NACA is one of those programs.

Google "Alabama housing grants" and you'll get results.

@Ryan Webster

Google.

@Lexie D.

Offers should be in writing. Don't "throw" out hints or give verbal offers. View the property. Do you analysis. Submit a written offer that works for you.

You don't need to be a salesperson to buy a property. The price works for them and their situation or it doesn't. They are selling you the property, not the other way around.

Also, sellers base their decisions on current market value, not ARV. $420K isn't $100-$150K below market value. It's $88k below ARV, which is meaningless to a seller. They want to know what their home is worth now, even if they know you're going to flip it.

@Kevin Lefeuvre

Usually show before they submit an application. Otherwise, it will turn away most tenants.

Now, if you have 1,000 people trying to see the unit on the first day, then a soft application process help to weed out some people. But remember, part of the application process is checking credit and references. That puts a lot of work on your end if a good portion of the people are eligible.

@Shane Graves

Just tell them you're an agent and buying for yourself. Plus, this way you're building a relationship and they might have other properties for you down the road and vice versa.

@Bob Daniels

Purely for rainy day circumstances. You are correct that boilers should last 30 years, roofs also around that. Water heaters 8-10 years. 

I replaced a brand new boiler at year 9-10. Had a giant hole leaking steam out the chimney.  Middle of winter. Stuff happens.

A 4-plex with 4 boilers is likely to have one go at some point. The more doors you have larger opportunity for issues over time.

 Purchase agreements contain several contingencies. They can vary by state and by parts of the state.

Right of inspection

Appraisal contingency

Ability to get financing 

Lead paint contingency 

Property survey

Clear title

In some cases - cesspool, well water, radon etc

@Nikola Magdelinic

Title insurance just protects you against “unknown” issues/defects with title. Has nothing to do with known liens.