All Forum Posts by: Colin Perry

Hello All, 

I'm finally trying to get off "podcast mode" in my BP experience and get off the sidelines.  I've learned a lot from listening to others (and some past experience including buying my own house at foreclosure) but worried that I'm so anxious to do a deal that I'll overlook red flags.  

So here goes... I'm very interested in an upset bid on a foreclosure in a neighborhood which I'm very confident in.  I've run the numbers on my own and on BP's fix and flip calculator, and I'm more than happy with the return if repairs stay below $150,000.  That sounds like a huge, and thus conservative, number in my mind.  But is it??  How do you know what structural problems lie in an old house (built in the '30s) which you've never been in?  (I was lucky enough preview my own foreclosure/home before I bought it).  Let's say I don't have time to read 3 books on calculating rehab costs before I have to make the call on this one.  If you assume you've got to properly update a home for a nice neighborhood, how easy is it to spend $150k for a house less than 2000 square feet?  

That's probably enough info, but here are other thoughts running thru my mind.  If I get the house, open the doors and it's worse than I could ever imagine, I believe I can break even by selling the lot and walking away from the rehab.  I suppose that's an effective way to mitigate risk.  But is it?  Am I just looking for reasons to go for it?  Am I nuts to acquire a foreclosure without more experience in rehab costs, or do I have enough buffer to at worst learn and not lose my shirt?  

The last paragraph notwithstanding, does anybody have any rules of thumb for worst case numbers on foundation issues, mold, outdated plumbing, electrical, etc?  

My appreciation in advance to BP nation for your time!

Aha Brooks.  Looks familiar now that I see the picture.  I used to walk down Brooks often but can't place it for sure -- probably because you transformed it so nicely!  

@Candace Berry I'm a bit new on here.  Congrats on what sounds like a nice deal for you.  What was the property if you don't mind saying?  I saw your profile and noticed that you transitioned your strategy from ITB to other pastures.  If you are willing I wouldn't mind hearing about that transition in strategy.  I'd direct message you instead, but my newness to being active on BP is restricting that effort! 

@Karen Margrave and @Kenneth Bell thanks so much for the feedback.  My intent was to maximize profits.  I'd love to do this once as a model to learn and keep doing it as a model but not sure my life is conducive to that right now.  I'm getting feedback that my home will be worth a little more than I was penciling in my conservative estimates so I'll likely go the traditional route and get out of it right now.  I am going to put it up off market to see if I can hit a friends/family/connections buyer for a bit though.  Thanks again! 

In a few hours I'll find out if my upset bid for a trustee sale remains intact.  If so then I'll be moving my family into a great new property (yes I've done my homework on the auction process).  If I am fortunate enough for my bid to hold, then I'll want to sell my existing residence.  I have a great lot in a desirable "inside the beltline" (preferred area for tear downs) location.  The lot value could be worth nearly what the home would get on the market right now.  I'm contemplating contacting a handful of active home builders in this niche market to explore the idea of a partnership in which I would contribute the lot and they would put in a new home and we would potentially split the profits.  

There are plenty of hurdles and risks to clear in such a partnership but if you know of them please help me list them.   Also, how could I factor the current mortgage payments into the partnership valuation (assuming there is a viable deal to be had).  From a financing perspective I'm guessing no lender would loan the builder money without him holding the note.  So I'd have to sign over the note to the builder and hold a second?  I'm out of my league here but if you have experience in this arena please let me know. 

Thanks! 

@Jerry W @dmitriy fomichenko @brandon turner thanks!

Hello to all,

Just digging into this site but love it so far and look forward to sharing some inspiration, knowledge and deals with some of you on here.

A little bit about me - I was a commercial broker for 5 years in this market and did plenty of deals but have experienced a lot more fun and passion doing the first deal for me (other than a small/passive investment in a big out of state student housing deal) than at any time in those 5 years. I bought a rental in October that I'm happy with but want to get a few more under my belt!

I'll admit I can get distracted with multiple niches/strategies so all the info on here may lead to overload. Thanks for the resources nonetheless.

I'll end this by asking, how did you pick the direction of your first year or two in this business? Meaning wholeselling/rehabs/SFR/selfstorage/etc..

Thanks,

Colin