All Forum Posts by: Blake Lawrence

Yes, I would include that in the overall purchase price.  Although we haven't had to do much, apparently people in hawaii dont like to stay inside, who woulda known!

With the new loan the NOI is going to go down some, so I will need to update that and I can get back to you haha. I appreciate the response. I think what you mentioned was what I was trying to say (rather poorly) on checklist item #3. It should be fairly easy, given that we only use VRBO and Airbnb to determine all payments for future bookings. Your comment did remind me that depending on close date, their may be refunds owed for security or cleaning deposits that get refunded after close date for stays that occurred before close date

Any transfer of membership in the LLC has to be unanimously agreed upon all members. The sales priceof the property to another member would be "determined by the average of comparablesales reports provided by two different realtors". There are currently 0 sales in our complex with a 2/1 and a handful of 2/2 so that may be a bit tough to determine. Obviously market value is still a bit subjective, especially with limited data so I don't want to get too hung up on that portion of the deal. More so worried about capturing all expenses associated with the rental that have actual hard numbers.

I will try to keep this as short as possible. I am looking to find the most fair solution for both parties as my partners have been great and I hope to do future deals with them. 

We have a furnished short term rental in Maui. We split the down payment and are both on the loan.  The market has gone up substantially from when we bought. For business and personal reasons, my partners want to free up time and money as they bought a new business and wont to focus solely on that.   There are 3 options. 1- We sell and split the proceeds, 2- they find someone to take over their half or 3- I buy their half out.  I am looking at #3 now.  I am not too keen at purchasing at the current market price as I believe its nearly topped out, however looking at bigger picture, I would be owning it at the half way mark between the bottom of what we bought at and the current market now.

Condo was bought at 366, value is probably in the high 400s now, perhaps higher.  The complex we are in has had several 2/2 sell lately in the 520-560 range.  Ours is 2/1. One 2/1 is pending now with the same sq footage and floor plan, but on the top floor with vaulted ceiling (which makes the place feel bigger and gives much more sunlight).  Our agent estimated our place in the high 400s and this place is pending at a 510 list price (waiting on to close for actual price0. Any ideas on how to determine our price? Thinking best bet is to either wait on close of 2/1 and negotiate a few less for ground floor or wait on appraisal to come back for my refi.

Aside from the purchase price, I am trying to make a check list of items we need to address financially so neither of us are getting an unfair deal. Here is what I have so far -

1- Address taxes, insurance and hoa fees already paid or owed at time of close. Work percentages of what needs to be paid back or paid to at close.

2- Closing costs (assumed 6% fee and whatever legal costs to transfer full ownership of llc)

3- Determine date of ownership takeover and remove all payments for already paid for stays so when we split the bank balance we are truly splitting everything earned up to that date and nothing after.

4- Payments owed to cleaners/maintenance for work performed

5- Airbnb and VRBO membership fees already paid

Am I missing something?  Are there any major non financial considerations that I need to address? I apologize for the length, but I wanted to offer up as much as possible rather than ask for advice without showing I have done the work up front (big pet peeve of mine)

I think we are looking at owning it outright.  We are trying to figure out the way to calculate the fee to pay him.  Not sure if the project costs and all fees subtracted from the refinanced value is the best way to go but not sure of another method to calculate a payout here.

We have been financing properties and getting involved a  little bit with the buying and rehab process, but our contractor is the main on that (Finding, buying, rehabbing and selling).  We have been doing a 50/50 split on profit of the flips.

 Our newest property can be rented as a duplex, so we are looking at that method.  We are trying to brainstorm a payment method for that.  Has anyone ran into this situation before or have any suggestions. The only thing I could think of would be to pay half the difference between the refinanced amount - total project cost (purchase, rehab, fees, etc).

Thank you to both of you.  Both ideas are great, will post follow up.

We purchased a house as-is to flip.  After the fact we learned that they had buried a pool. Using google earth, I identified that the seller was the owner during the time the pool was filled in.  He did not disclose this anywhere on any documents.  It became an issue during a large storm last month. One of our laborers called to inform of us of smoke coming out of the ground.  What ended up being the problem was that ground water was getting vaporized by an electrical charge from the the power supply underground servicing the pool.  At that time we had already had found out there was a pool as the breaker box had a break labeled "pool".  We turned that off and the problem went away immediately.  We are installing a new breaker box and that power supply will obviously be removed.  However, on top of that electrical issue, the ground is sinking in very noticeably around the area where the pool was filled in, meaning the backyard may need additional work and the soil itself that was used may not hold grass or vegetation like the rest of the property.  

My questions are-  Did that need to be disclosed? If so, is there any documentation online that I can reference?

Did that work need to be permitted?  If so, will that be info that we can find publicly?

We have contacted the seller's agent and they responded back basically in all caps and exclamation points telling us no way they'd help, which leads me to believe something is wrong.

Thank you in advance from a rookie learning on the job.

So how do you include the 8k in your calculation. I would think if you want an accurate picture for investment sake you'd want NOI/(purchase + rehab). Or will that only work if both are paid cash in full. Sorry first question since joining, might be a bit newbish.