All Forum Posts by: Derek Robinson

FYI, my buddy’s A frame in black mountain just fell out of contact. Perfect opportunity to buy a newly remodeled A frame in Black Mountain!

https://www.zillow.com/homedetails/11-A-Frame-Aly-D-Black-Mo...

Hey Jason! That’s a lot of very specific questions!  I won’t answer them all, but I will ask you a general question to get the ball rolling.

Do you plan to pay all cash for the land purchase and construction? Otherwise, I highly doubt you'll be able to cashflow or even break even if you have any kind of mortgage on this property. Building cost have been high and are trending upwards in the future, plus the cost per square foot can double when building unique structures. Plus, STR occupancy has taken a significant dive since Helene hit the area and it still hasn't rebounded.

I would look at something already built and for sale in the areas you like, run your numbers, and see if it works for you. If it does, then you can take your next steps in looking at building (I’m pretty confident that buying right now would be cheaper than buying land and building).

Of course, none of this matters if you are paying cash, but then that begs the question if this would be your best investment choice.

Not trying to crap on your parade, just some insight from a local investor.

Quote from @Jay Hinrichs:

Quote from @Derek Robinson:

Quote from @Eric Gerakos:

I heard that he has added another “E” and is going by “Steeeve” now. Probably just a rumor…

Dude, are you just following this post to make fun of someone's name?

great post to start the week..  but since we are curious why do you want to know about this Steeve dude ?  Since your a coach does this have to do with taking him on as a mentee or student.. Just curious.. 

Doing some due diligence. Can't find much about him online.

Quote from @Eric Gerakos:

I heard that he has added another “E” and is going by “Steeeve” now. Probably just a rumor…

Dude, are you just following this post to make fun of someone's name?

Quote from @Ken Boone:

Quote from @Collin Hays:

Just an hour west of Asheville is the Maggie Valley-Waynesville-Cataloochee area. This is a somewhat less commercialized version of Gatlinburg, and might be worth considering.

I drive through this area all the time.  The realtors are pushing Waynesville as if it’s a destination place for people wanting to visit Asheville because it’s only “20 minutes to Asheville” so it’s in the hot bubble for the Asheville market.  I don’t see it.  I know people visit Maggie Valley but man every time and I mean every time I pass through there it is just dead.  No traffic. Stores and restaurants only have a handful of cars in front of them.  It doesn’t matter when I go through there. It’s always like that. Been that way for years. 

Spot on.  Waynesville always seemed like a stretch to me...more like 30 to 45 mins from Asheville if you are talking city center to city center.  A good spot for groceries, a nice downtown, and close to some great outdoor recreation...but it's no Asheville and no one wants to drive 40 mins into Asheville everyday.  Plus, areas like this are at a discounted price because of the distance.  Maggie Valley...I really wanted to see this area thrive, but I've watched it for 12 plus years and it just hangs on.  Dead all around, even on nice weekends.  Apparently Ghost Town made the town thrive, but since it shut down, things have been dead.  People keep hoping for Ghost Town to reopen, but I can't see that ever happening.

Disclaimer* I don't have any STRs in Asheville currently.  But what I'm hearing from the meetups is that things are still incredibly slow since Helene.  Also, every month I hear of another handful of quality/long standing restaurants shutting down because they just couldn't wait any longer for the tourism to come back.  I haven't directly heard of any hotel vacancy numbers, but I can't imagine they are doing well either...I've been downtown on the weekends and am shocked at how dead it is compared to normal.

Even before Helene, I was hearing a lot of people having issues with their STRs. STRs have always done well here, but during Covid, everyone one rushed to the market to purchase STRs and nightly rates were incredible high and people were making a killing. Then the Covid burst slowed down and things got back to normal and people started struggling because they bought too high and were running their numbers based on an insanely lucrative snapshot in time. A lot of STR operators switched to MTR, but it seems to be more of a pivot to stop the bleeding and not their original plan.

Being the closest as possible to Asheville brings the highest income, but restrictions have made that difficult, even if you could get the numbers to pencil.  Some outskirt areas jumped on that band wagon and starting restricting as well.  The entire county even started putting rules into place, but I'm not sure where that all landed.

In terms of amenities, yes, you really have to go big here in my opinion.  Everyone used to just put a house up and it did well, then you needed hot tubs to compete.  Now I'm hearing about saunas and cold plunges.  Someone was asking the other day about a contractor to install things like mini golf.  I know some guys that do large houses with pools.  It's getting really expensive to compete these days.

Not trying to be a bummer, just telling you what I'm seeing.

Quote from @Eric Gerakos:

Personally, I wouldn't work with anyone who can't spell Steve. But that's just me.

Maybe his parents were creative?

Hello all!  Does anyone know Steeve Raymond.  His company is Selective Real Estate and he does construction and flipping.  He works mostly in Chicago, Illinois.  

Quote from @Alan Asriants:

Quote from @Derek Robinson:

I used to own 3 Section 8 rentals in the Spartanburg, SC area.  The areas were not the best, but I had professional management and never had any trouble.  Two of them came with Section 8 tenants when I purchased them.  My plan was to increase rents to get the tenants to leave, do a lite rehab, and re-rent.  Well the rent increase was mostly paid by the government so the tenants never left.  I think they only had to pay $50/month while the government covered $500-$600.  We rarely had maintenance requests, tenants paid on time, and the annual inspections showed average wear and tear.  I pivoted at the time to mobile home parks and sold all three at a profit.  So, made money monthly and sold at a profit.  Super hands off with a great manager.  Tenants were mostly young adults with multiple kids.  One thing I did spend a lot of time on was driving the neighborhoods before I purchased.  You could drive down one block with run down houses, people hanging out in the yard during the day, dogs chained up in the front yard, etc.  Then the next block over would have clean houses, sense of ownership, etc.

If you were making decent money why did you sell? What was your ROI on sale?

As stated, I was pivoting to mobile home parks, so I sold and put the profits into that.  I don't remember specific numbers, but I bought them for 28k to 45k cash, rented for $450 to $550, and sold for around $55k each. Had them for around 3 years.

My main point was I had good management in place, tenants only had to come up with around 10% of the total rent, never had any issues with tenants, and they appreciated.  I believe you can do well with these properties if you know what you are doing.

I used to own 3 Section 8 rentals in the Spartanburg, SC area.  The areas were not the best, but I had professional management and never had any trouble.  Two of them came with Section 8 tenants when I purchased them.  My plan was to increase rents to get the tenants to leave, do a lite rehab, and re-rent.  Well the rent increase was mostly paid by the government so the tenants never left.  I think they only had to pay $50/month while the government covered $500-$600.  We rarely had maintenance requests, tenants paid on time, and the annual inspections showed average wear and tear.  I pivoted at the time to mobile home parks and sold all three at a profit.  So, made money monthly and sold at a profit.  Super hands off with a great manager.  Tenants were mostly young adults with multiple kids.  One thing I did spend a lot of time on was driving the neighborhoods before I purchased.  You could drive down one block with run down houses, people hanging out in the yard during the day, dogs chained up in the front yard, etc.  Then the next block over would have clean houses, sense of ownership, etc.