All Forum Posts by: Curtis Bellenot

Justin, You need to understand if you feel comfortable with it, then go for it, but if you don't then it'll give you nothing but problems and grief. 

There are two times of cheap neighborhoods, the ones that are in the path of progress that will appreciate with time (Gentrify) and those that will just be cash cows and not increase in value. 

I currently invest in both, the path of progress are great but you are betting on the actions of others, so while the pay off is potentially huge, it sometimes doesn't work out as planned. I own a beautiful victorian duplex that is on the edge of the ghetto, across the street from the site of the new police station... that was supposed to be completed in April of 2017... so while the property makes money, the appreciation is not there yet, and I have to wait for my little messed up city to come through with the plans it has already laid in place.

The second type of lower income are the cash flow areas. These areas are blue collar type or warzones. I would recommend buying in poor areas that still have a lot of "pride" in their neighborhood. I call these "grandma ghettos" cause grandma still lives there and doesn't tolerate any BS that goes on. Look for mowed lawns, trimmed hedges, and clean - if not a little old- cars. I find that providing a good product, with quick service when a maintenance request comes in and a sense of respect really goes far with these type of people. 20-30% cap rates with low stress are possible in these areas. I would stay away from lots of boarded up buildings, broken down cars everywhere, stray dogs running the streets and trash everywhere if you know the place isn't going to appreciate. 

-Curtis

If you have a credit score above ~650 you should be able to get a home refinance or Home Equity Line of Credit that will be at a favorable term (15-30 year loan at 4-6%) from any of the local banks like Ameris, Bank South, First Chatham, Georgia's Own Credit Union. They will usually lend 65-80% of the home's value. 

Hey Justin,

Dave Ramsey is great to get your finances under control, investing is where you can grow them! Buy and hold rentals are a very safe, low risk way to grow your wealth. Savannah is an excellent market for this, I have found that in Savannah and surrounding areas a 12-15% CAP rate is doable on the MLS. It is also a growing area, you may be able to catch some appreciation as well.

Feel free to contact me about any Savannah specific questions. 

-Curtis

I'm in Savannah, GA and I use Draper & Kramer. I'd be more than happy to my mortgage officer's number, she is EXCELLENT! 

@Ian Skelton I buy almost everything off market, Eastside Savannah (North of Parkside) is great, Rincon is great but those are my basically "turn key" numbers. I have experience flipping houses so most of my personal rentals are strong value add propositions. Check out one of my deals https://www.biggerpockets.com/forums/223/topics/416624-great-rental-in-savannah-georgia-purchase-price-4500. This is a B-C community but I'm comfortable there, its a working class neighborhood, not a welfare class. There are 20%+ returns in Short term vacation rentals, but the city is "shutting it down" in July, so it will just move to an unregulated space. 

@Jay Hinrichs This is an awesome write up and I loved Charleston when I went up there this past year! What are some of the things buyers are looking for at the higher end range? I'm in Savannah, GA and will see a downtown renovated property go for 660k and then across the street, similar home, similar SqFt will go for 1.5-2mm. What sort of interior finishes, appliances, etc are you putting in your houses to get the max price per sqft?

@Julian Buick I'm ex-military in Savannah flipping houses full time, there's a lot of opportunity down here, pm me if you'd like to grab coffee or lunch sometime. 

Savannah, GA is a great rental market, it has a stable economy with many areas of employment. I'm usually getting 12-15% Net Cap rates for long term rentals. For short term vacation rentals, the city is proposing changes to stop all new short term vacation rentals that are not owner occupied after 9 July. Feel free to PM for more info. 

Hi Kendall,

Congrats on taking the leap to get into this great market! I'm in Savannah and am a full time real estate investor, doing flips, rentals and the BRRR strategy. Some other posters have gotten burned dealing with crappy tenants and I understand their frustration with certain aspects of being a landlord, but it comes with the territory. I just put under contract a 3/1 SFR that rents for $950 a month, tenant already in place, for $67,000. If you would like get the details, shoot me a PM and I'll be glad to send you pictures and further details.

Looking forward to hearing from you,

Curtis

Alan, 

I bought my first house in El Paso and currently reside in Savannah, GA. Both are great markets! I've got an AMAZING Property Manger/Realtor in El Paso who I can get you in contact with. He managed my property for 3 years while I was over seas and when my El Paso house tenant moved out, he helped manage a quick cosmetic flip and when we listed the property we had a full price offer in like 2 weeks. I can't say enough good things about Roberto! 

Hi my name is Curtis Bellenot and I recently completed an awesome project in Savannah, GA.

Quick run down is: 3/1, 1300 sq/ft, brick, ranch style home.

Purchase Price: $4,500

Rehab: $13,500

Misc Expenses: $1,500

Total: $19,500

Rental income: $850 a month

To give you some back story, I bought my first rental in 2013 in El Paso, TX while I was stationed at Ft. Bliss, fast forward 3 years and I was living in Savannah, GA flipping houses and making enough money to get out of the Army. I've done 10 deals now, some flips, wholesales and rentals, building some pretty good contacts and relationships along the way. This deal came out of a wholesaler friend who doesn't like to go to "this part of town" and told me the seller wanted to sell his house for 5-7k. I gave a quick call, at 2pm and the seller said it was a 3/1 didn't know the Sq/Ft, hadn't lived in the house, but needed money to fund his other business so I made an appointment to see the house at 6pm, had it under contract for $4,500 at 6:30pm. When the deal is good, you need to move fast. 

So here is the property on a map, its right next to an Army base, which is usually a lower end area, its on a busy street, so for 5-7k I'm expecting a real piece of crap. I do a quick property record search and then look for recent sales and am blown away! 

The red dot is the subject property, less than an 1/8 mile away there is a 3/2 that has sold for 114k!!! 

And here's the property record file photo! This is gonna be great! All brick construction, roof looks good, new windows, cute curb appeal for this style of home. As long as the electrical and plumbing are good I can do a full rehab on this and still come out ahead. My exit strategy here is to flip it or maybe rent it out, both look good and if you have multiple viable exit strategies you are in a good place. 

The A/C line was cut, and the house has been vacant for about a year, so the inner part of the old unit is probably totally corroded (its hot and humid here) so add that to the budget, about 4k.

Tile in the kitchen, stripped floors and the drywall looks in good shape.

Bedrooms all look pretty good, (except where they ripped out the A/C line for $5 worth of copper....) and this guy wants 5-7k?! Oh, here's the issue in the laundry room... 

and the ceiling 

So it needed some drywall and we have a leak somewhere... 

Kitchen looked good though 

And hallway between kitchen and den, there was some work done at some point...

So first Red Flags were a giant leak in the laundry room ceiling causing the drywall to be torn down, water is not turned on, so plumbing might need to be entirely redone (quickcrete in the plumbing). The wiring looks good, but the power is off so budget for that as well. A/C is scrap, so a new condensor and maybe a new air handler/furnace. So worst case would be about 35k repair, but if we get lucky maybe 12k or so to do the entire house. So I offered the seller 3k, he didn't say anything, I let the silence do the work, he said 6, I said no way, and went back out to the A/C and he cam down to 5, I went to 4. He sat at 5 for a bit and so I said how about 4,500 and we can close as soon as my lawyer does the title search, he signed my contract and 12 days later the house was mine (and the wholesaler received $500 for the phone call, I like to take care of people who take care of me).

The after pictures: 

Kitchen came out great, we used grout refresh to stain the grout, the appliances were $900 for Fridge, Stove, Microwave, Washer and Dryer from a local "Scratch and Dent" used appliance place.

Laundry room fixed, painted with used appliances! 

This deal was a home run any way you look at it. It was dirt cheap, I put everything on a credit card (even the house purchase with balance transfer checks). The colors were simple Navajo white, cheap dark laminate flooring, light blue in the the bathroom, new fixtures, new water heater, new A/C so that the main systems are good and I don't have to worry about them for awhile. While I was getting this one ready I put a bunch of signs "We Buy Houses" in the front yard and I got a signed lease and deposit before we were even finished. So with a Cap rate of 52%, a good tenant, I'll be keeping this one, refinancing it, and looking for more great deals in this neighborhood that is NOT a warzone but a good working class area.

Feel free to shoot me any questions or comments. 

-Curtis Bellenot