All Forum Posts by: Dave Carpenter

Dejan N. - Oddly enough, I grew up just north of Brown Deer and 97th in Mequon, and I currently work just a bit east of Silver Spring and 60th by Bayshore Mall.
Brown Deer Rd and 97th area is a bit tougher these days as Northridge Mall and many of the surrounding stored (Best Buy, Walmart, many others) have moved out. There is talk of Northridge being purchased, but I have heard those rumors a few times before and nothing materialized. I am not as familiar with Silver Spring and 60th but Dawn A. has some single family homes a bit south of there. I bet she could give you some insight.

Dejan N. - Welcome to BP! I am also new myself and have found a number of Wisconsinites who are happy to chime in on the blogs. I'm sure you will hear from them soon if they have the same keyword alerts that I do.

Where specifically in Milwaukee are you looking to invest?

@Matthew Cariello - I agree your numbers seem ok on that property, but I also agree with Brian Feltz that you could likely find a bit better deal.

One thing to consider, especially on your first purchase is any repairs that are needed on the unit in light of what an insurance company might think. When I bought my duplex, I had a roof that was likely 15 years old, and from my perspective still had some useful life left. However, my insurance company decided that it needed to be replaced before they would insure the property. Needless to say 10k later I was able to get the unit insured properly. It was not an upfront expense I had planned on, and luckily was able to cover that cost.

Just something to keep in mind as it caught me off guard.

Good luck!

Sean,

Welcome to the area! I too am looking to build a portfolio in the Milwaukee area and would love to chat with you sometime.

I have enjoyed the podcasts too, and am about to run out as I am going through about 1 per day during my commute.

See you around here.

@j Scott - that is a great idea to move the 125k to equity and I think I could get them to agree. Then having an available first Leon position available for the other 200k does seem like a desirable situation for a HML or portfolio. Thanks for the advice!

@j Scott - great advice! That has just been a starting point. My next steps are figuring out finance options and then want to get a contractor (or 3) through the house to give me a better feel for rehab costs. I am also thinking I would want an agent to come and give me a feel for what I can sell for based on the market and quality of rehab.

The $35 sq ft is good info to know too!

Things like bedrooms are in pretty good shape, but there is certainly some real work that needs to be done. I have been talking with @jenkins Ramon about this too. He pointed out trying to get a 70% LTV as well. Seems like I am a little over that based on my round numbers right now.

Additionally, the developer thinks this property could sell for between 400k and 500k depending on quality of the rehab. In my basic search for comps, 400k seems very reasonable, thought I personally think 500k might be a bit high.

Hey there all! A REI newbie here with a question that I think is fairly common for first time investors.
I am in the beginning stages of lining up a single family flip in the northern suburbs of Milwaukee, Wisconsin. Here is the back story:
I met with a developer this last week who has a relatively run-down house on land he is planning to develop (would need to gut kitchen, and bathrooms, redo floors, paint, new roof, HVAC, landscaping, finish walk out basement).
For context, it is a 16 acre parcel that he will likely divide into 3 plots (one being the lot with the house already on it) He develops higher end custom homes 400k +, and doesn’t really want to rehab this house, but sees the potential it holds.
As I will be rehabbing a house adjacent to the developers sites he is interested in seeing me success, and has offered to provide some mentoring and connections, however he has very little activity in financing in this way, so I thought I would reach out to BP!

Here are the details:
2800sqft house
4 bed, 2.5 bath
3 acre wooded lot
Asking price – 200k
Estimated rehab costs – 100k
County assessment a few weeks ago – 195k for land, 148k for building

I currently have a private lender who is willing to invest 125k likely with a 10% return, though also discussing equity split. I am able to personally put up only a small amount of money as I currently own a duplex and SFH, neither of which have much equity yet.
What are suggestions on how to get the remaining investment needed? I am open to HML, equity split, or another private lender. I know having multiple investor's means that the risk goes up for the lender who doesn't get 1st position.
Any suggestions on strategy would be appreciated.

Thanks!

Dawn A. - that could be. I think you were involved in the thread, which is what brought me to it. An interesting concept, but I feel like I should have enough cash to cover the few day gap between paying the mortgage, and getting rent checks. Also, I have been really blessed to have great tenants who actually do pay on time or maybe on the second. It has not been an issue for me yet!

nice touch with the link. At first I thought it was the wrong link... then I got it.

Sounds like the UK is already up and running. I cant wait till it makes it across the pond ;)