All Forum Posts by: Steven Griffith

One more note - I reached out and asked about the HOA policies on Short Term and Long Term rentals. Here is her response:

"HOA information is not complete but it will allow a % of homes to be rentals. We hope to have those documents finalized in the next few months."

 Good to know the plan is February. When I asked, I was told "Spring 2020".  Thanks for following up! 

Unfortunately I don't know what their rental policy is/will be.  I'll share if I can get a straight answer.

Gabe, I got the exact same boiler plate response as you. Sometime this year seems to be the consensus. 

@Aaron Howell my thoughts exactly.  The only exception I can think of if it's on Orangedale or Prospect Ave?

@Tom Fisher what a steal!  Great job to you and your team!

For everyone's info, this is a new development currently ongoing in Pittsboro, NC - just south of Chapel Hill off of 15-501. By ongoing, I mean planned with a lost of the initial groundwork being done. No housing yet. It's a mixed use community - supposed to have apartments, townhome, SFH, restaurants, shops, schools, etc. There are some restaurants and storefronts opened now, however. I'm also interested in this area, so I've been doing my own research.

@David Gaudet when you have the time, take a drive down to Pittsboro.  The developers have recently opened a store front in downtown Pittsboro where they have all the plans for Chatham Park laid out, along with estimated timelines.  I was there a few weeks ago and it was really helpful.  You can see where the SFHs will be schools, restaurants, townhomes, etc and get a rough idea of when different phases will be open.  Some of the information is here:  https://www.chathampark.com/.  Regarding eventual plans, here's a quote from an article about a year ago: 

"Eventually, Chatham Park is expected to have 22,000 homes, along with stores and offices. The development will be broken up into four or five villages that are made up of neighborhoods."

@Mike Hyder makes some great points about the pros and cons of buying new.  The one additional thing I would add is, given the scope of Chatham Park and the fact that there are no homes now, if you're going to invest here then consider investing early.  Developers raise the prices of homes in a neighborhood as time goes on.  If you buy your new home early during a neighborhood's development, you will have purchased your house for less than someone who buys the exact same house a year or more later.  And certainly for less than someone who buys their house 5-10 years later.  While I doubt you'd be able to do anything to force the appreciation of the house initially (as it's a brand new house...), there is almost an inherent appreciation because the developer will raise the base price of the house every couple months.  Especially around the Triangle area, as I'm sure you know.

@Mike F.

Can you chime in? I know you're in Chapel Hill, not Durham, but you've got some great experience with what's going on at the city governance level. Especially considering Raleigh's recent restrictions on STRs...

@Uriah D.

Wednesday, July 10th

Great, looking forward to it!

@Joe Hermanson

Yes, that's what I've concluded after speaking to 4 different banks now.  They all told me the same thing - if you have reported income on your previous years taxes for your investment home, then their rates are either higher or (in 2/4 cases) they don't do HELOCs on rentals.  The only option is to do a cash out refinance.

They all made the caveat and distinction that if it is just a "second home" which I rent out for air b'n'b or otherwise, then they can do a HELOC with the better rates. In my situation, though I've had renters for the past 3 years ans have reported that income on taxes.

@Ali Parnell

Hi Ali,

An undisclosed Reserve means the seller has set a minimum amount below which they will not sell the house. So if you were to win the house for 34k, this does not meet the reserve and they would not sell you the house.

This is a strategy to drive up interest. I have a similar situation near me where a house is listed for 74k on an auction site with the notation that this has not met the undisclosed Reserve. Looking at property records, Zillow, and other sources, I'm guessing the reserve price is somewhere around 105K. The strategy is this: if they list something at such a low price, there is more interest and more folks likely to bid on the auction. More folks interested and paying attention/following the auction generally means they will get a higher price in the end.

Unfortunately, to my knowledge, there is no way to know what this reserve price is. Hence the term"undisclosed". Good luck though! While others may have more insight, my guess is the reserve price for a 34k home is probably in the neighborhood of 50-65k. That is purely a guess though. Good luck!

@Dejuan Calloway

Hello! I'm sure others have much more experience to draw on, but I actually have this exact same question. In fact, coincidentally, I actually went into two major banks today to talk to both Loan Officers about this exact issue. Here's what I was told:

Bank 1 - This is my primary back where I have had my checking/savings for 4 years. Their answer was: No, they won't do a heloc on a rental property unless it's classified as a second home. To be classified as such, it would need to be primarily air bnb or another short term rental. Since I have renters full time, with a lease, it doesn't qualify so they won't do a HELOC. The loan officer encouraged me to refinance instead and take the cash out since I have significant equity in the house. Im not interested in this though bc my original morthage has an interest of 3.5%.

Bank 2 - This is the bank that bought my original loan and now hold my rebtal property mortgage. They said: Yes, they will do a HELOC, but with a much lower LTV - 60% instead of the 75 - 89% advertised elsewhere.

I have not yet approached smaller banks or credit unions, although I plan to just to hear their response and rates.

I'll be following this post quite closely - thanks everyone in advance for your insights!