All Forum Posts by: Jackson Ebersole

Hi Paul,

Charlotte is considered a good market for house hacking due to its demographics, safety, and quality of life. The city offers various multi-family housing options suitable for house hacking, including duplexes, triplexes, fourplexes, and townhouses.

Regarding the mortgage securing, I could be of help with that, I work for a private lender that lends in 48 states, including North Caroline.

Find a realtor familiar with investment properties and house hacking strategies in Charlotte. Here you have a few options:

- Terry McDonald - McDonald Group - eXp Realty, Phone: (704) 390-6221. This is a father-son duo with extensive experience in Charlotte real estate. They're experienced in working with investors and first-time home buyers. Use state-of-the-art technology and have a strong online presence

- Kathy Norman - Keller Williams Realty, Phone: (704) 609-3728. She specializes in various types of properties, including investment properties. She is experienced with first-time home buyers, which could be beneficial for house hacking strategies. She's consistently recognized as a top producer in the Charlotte area.

If you’re going to be getting a mortgage, please be aware that you won’t be able to choose the appraiser, but as an appraiser yourself you are at a great advantage to estimate the value of the property post rehab.

By leveraging your experience as an appraiser and focusing on building a strong team familiar with the Charlotte market, you'll be well-positioned to start your house hacking journey. Good luck with your investment!

If you want to talk about financing options, please feel free to reach out. Regards,

Jackson.

Hi Chris,

The deal could potentially work, but it's tight. The price seems slightly high given the pre rehab comp you mentioned. You'll need to be very careful with your renovation budget and timeline.

Your renovation estimate of $120k-$150k seems reasonable for adding a bathroom, redoing the kitchen and existing bathroom, closing in the garage port, and doing cosmetic updates. However, always budget for unexpected issues, especially when adding square footage.

Seller financing could indeed allow you to offer more, but you're right to be concerned about funding the rehab. Look into a renovation loan that would cover both the purchase and the rehab costs. Consider bringing in a partner who can help fund the rehab in exchange for a share of the profits. Explore private lenders who specialize in rehab projects. However, if the seller is giving you a credit they might lend off the price net of that credit.

As for the balloon payment that shouldn't be a problem if you sell the home, which I imagine is the end goal?

Be cautious about overpaying, even with seller financing. The terms of the financing (interest rate, balloon payment timing) need to make sense for your exit strategy.

I would recommend getting a detailed inspection to ensure there aren't any major issues you're overlooking. Get firm quotes from contractors for the renovation work to ensure your budget is accurate. Consider negotiating a lower price, given the work needed and the recent $390k sale in the area. If you proceed, have a clear exit strategy and backup plans (e.g., ability to rent the property if you can't sell quickly).

If you want to talk about private lending options feel free to contact me.

Regards,

Jackson

Hi Angel,
A Home Equity Line of Credit (HELOC) is a specific type of credit line that uses your home as collateral. When people refer to a "credit line against your home," they are typically talking about a HELOC. A general credit line, on the other hand, could be secured by other assets or unsecured, and doesn't necessarily involve your home equity.

HELOC Characteristics:

• - Uses your home as collateral
• - Usually has a lower interest rate than unsecured credit lines
• - Typically has a variable interest rate
• - Allows you to borrow up to a certain limit, repay, and borrow again during the draw period
• - Can be used for various purposes, including home improvements, debt consolidation, or as an emergency fund

While it's possible to use a HELOC for RE investing or rehab projects, some lenders may be hesitant about this use. They might prefer to see the funds used for improvements on the property securing the HELOC. If you're specifically looking for funding for real estate investments or rehabs, you might want to consider investment property lines of credit, business lines of credit or private lending.

Let me know if this makes sense or you have any further questions. If you wanted to get some more information on getting funding from a private lender feel free to contact me.

Regards,

Jackson

Hi Vida,

Based on your goals and budget, here are some suggestions for building a small home with a business space in the Atlanta, South Carolina, or North Carolina areas:

Building options:

1. Modular homes: These can be a cost-effective option, allowing for faster construction and potentially lower costs compared to traditional building. They offer flexibility in design and can be customized to include a business space.
2. Shipping container homes: While trendy, these can be challenging for mixed-use (residential/commercial) purposes due to zoning and building code issues in many areas. They may work better in more rural locations.
3. Prefab/kit homes: Similar to modular, these offer cost savings and faster construction times. Look for manufacturers that can customize designs to include commercial space.
4. Pole barn homes: Popular in rural areas, these can be an affordable option for a combined home/business structure.

Location considerations:

1. Zoning: Look for areas zoned for mixed-use or that allow home-based businesses. This may be easier to find in smaller towns or rural areas.
2. Growth potential: Research areas with growing populations or emerging business districts.
3. Tax incentives: Some localities offer incentives for small businesses or specific industries.
4. Infrastructure: Ensure reliable internet and necessary utilities for your business.

Potential locations to explore:

1. Atlanta suburbs: Consider areas like Decatur, Marietta, or Lawrenceville for a balance of affordability and proximity to the city.
2. South Carolina: Look into growing areas like Greenville, Rock Hill, or smaller towns in the Upstate region.
3. North Carolina: The Research Triangle area (Raleigh-Durham-Chapel Hill) offers opportunities, as do smaller cities like Asheville or Wilmington.

Remember to thoroughly research local building codes, zoning laws, and business regulations in any area you're considering. Your $300,000 budget is workable in many areas, especially if you're open to more rural or suburban locations. However, costs can vary significantly depending on the specific location and type of construction, so be prepared to be flexible with your plans.

Let me know if you have any further questions. Regards,

Jackson.

Hi Aaron,

Congratulations on your first flip and your success in becoming a realtor. These two achievements will definitely help you in securing funding for future projects, as private lenders consider experience when deciding what leverage they're willing to offer you. These experiences have obviously helped you learn how to manage a rehab and better understand the market.

Regarding your first question about whether to keep the fixer-upper as a short-term rental (STR) or sell it, I can't provide the most specific advice without knowing the property's location, STR rental rates, and demand in the area. However, ultimately, the decision to keep or sell the property depends on your personal preferences and financial goals.

Reasons to keep the fourplex:

1. Established cash flow: You mentioned the property will cash flow around $675/month now and $1000/month when paid off in 7 years. This is a solid, predictable income stream.
2. Low debt: With only 7 years left on the loan, you're close to owning it free and clear, which will significantly boost cash flow.
3. Diversification: Keeping the fourplex provides diversification alongside your other investments and W2 income.
4. Local market knowledge: You likely have a good understanding of the local market after 10 years of ownership.
5. STR potential: Michigan has some attractive STR markets, especially in tourist areas. If your town has tourism appeal, converting to STR could potentially increase your returns.

There's also reasons to consider selling:

1. Market conditions: Michigan's real estate market has seen significant appreciation in recent years. You may be able to capitalize on this if your area has experienced similar growth.
2. Simplification: Selling would allow you to focus on your new single-family investment properties and potentially expand in those markets.
3. Capital for other investments: The proceeds from selling could be used to fund other potentially higher-yielding investments, especially if you use a 1031 exchange.
4. Small town limitations: Depending on the specific town, there may be limited growth potential compared to larger markets or more popular tourist destinations.

Given the stable cash flow, low remaining debt, and your established experience with the property, keeping the fourplex seems like a solid option, especially if it's in a location with STR potential. However, the decision ultimately depends on your overall investment strategy, the specific characteristics of your local market, and your personal financial goals.

Let me know if there's anything else I can help you with. Regards,

Jackson

Hi Dan, 

I just sent you a private message. Looking forward to it. 

Quote from @Willis Yoder:

Quote from @Jackson Ebersole:

From our experience, when flipping properties the most efficient ways to spend your money are the following:

Focus on kitchens and bathrooms, as these areas consistently provide the most value for your investment. A midrange kitchen remodel has a 96% ROI, costing an average of $27,492 and adding $26,406 above your cost in value.

You could also go for slightly larger rehabs, such as adding a bathroom or a bedroom. For example, adding a bathroom can increase your home's value by 10-20%, depending on the quality and type of bathroom. A full bathroom addition can potentially boost value by up to 20%, while a half bath might add around 10.5%. The cost of adding a bathroom typically ranges from $25k to $60k for a full bath, or $6k to $12kfor a half bath. However, you can expect to recover about 50-55% of your investment when selling the home.

Improve curb appeal, clean up the exterior, add landscaping, and make minor improvements to enhance the property's first impression. Landscaping has the largest ROI (of about 200%), adding a wood deck or a patio will also provide a big increase in value (100% ROI).

Add living space, consider converting attic space, finishing a basement, or repurposing a large living area to add a bedroom without expanding the home's footprint - this will give you an average ROI of around 75%. If you're going for a larger rehab, adding an ADU or doing an enlargement also provides a good return, although it is smaller than what we've seen before, around 50% ROI.

We're a private lender. If you have any more questions or are looking for funding please feel free to reach out to us.

Regards,

Jackson

Great insights—thanks for sharing those numbers! It's interesting how kitchens and bathrooms consistently top the list for ROI, and I can see why focusing on those areas makes a big difference. I'm also intrigued by the potential of adding living space through attic conversions or finishing basements—those tend to be great value-adds without having to expand the home's footprint.

I'm curious, though—do you find that the ROI varies significantly between markets or property types? I'm primarily working on fix and flips around South Bend and Elkhart, and I'm always looking to fine-tune where to best allocate funds. Would love to hear your thoughts on how these strategies might apply to properties in those areas!

Hi Willis,

ROI can definitely vary between markets, even within the same region. South Bend and Elkhart may have different buyer demographics, price points, and demand drivers.

The median list prices are under $160,000 in South Bend, targeting lower-priced properties allows for better profit margins. Look for homes priced below market that need mostly cosmetic updates.

Different property types (single-family homes, multi-family, condos) can yield varying ROIs. In South Bend and Elkhart, single-family homes seem to offer better ROI due to demand from both homeowners and investors.

Kitchen rehabs tend to provide the most ROI in all markets. In the Midwest, finishing basements or adding outdoor living spaces can be particularly valuable. Local buyers are seeking modern finishes like LVP flooring, granite countertops, and stainless appliances.

South Bend's economy is influenced by Notre Dame University, while Elkhart is known for RV manufacturing. Target renovations that appeal to the local workforce and lifestyle. In college towns like South Bend, features that appeal to potential landlords (like extra bedrooms or separate entrances) will boost ROI.

In colder climates like Indiana, spring and early summer are often the best selling seasons. Plan your renovation timeline to list properties during peak buying months - also take into consideration that snow and rain will affect your rehab.

Another way that you will want to take climate into account is that given the cold winters, energy-efficient improvements like insulation and modern HVAC systems can be attractive to buyers. These upgrades can help differentiate your property in the market.

Let me know if you want to connect! Regards,

Jackson

Hi Willis,

ROI can definitely vary between markets, even within the same region. South Bend and Elkhart may have different buyer demographics, price points, and demand drivers.

The median list prices are under $160,000 in South Bend, targeting lower-priced properties allows for better profit margins. Look for homes priced below market that need mostly cosmetic updates.

Different property types (single-family homes, multi-family, condos) can yield varying ROIs. In South Bend and Elkhart, single-family homes seem to offer better ROI due to demand from both homeowners and investors.

Kitchen rehabs tend to provide the most ROI in all markets. In the Midwest, finishing basements or adding outdoor living spaces can be particularly valuable. Local buyers are seeking modern finishes like LVP flooring, granite countertops, and stainless appliances.

South Bend's economy is influenced by Notre Dame University, while Elkhart is known for RV manufacturing. Target renovations that appeal to the local workforce and lifestyle. In college towns like South Bend, features that appeal to potential landlords (like extra bedrooms or separate entrances) will boost ROI.

In colder climates like Indiana, spring and early summer are often the best selling seasons. Plan your renovation timeline to list properties during peak buying months - also take into consideration that snow and rain will affect your rehab.

Another way that you will want to take climate into account is  that given the cold winters, energy-efficient improvements like insulation and modern HVAC systems can be attractive to buyers. These upgrades can help differentiate your property in the market.

Let me know if you want to connect! Regards,

Jackson

Hi Tony,

Depending on what the full story is your lender might be able to provide you with a refinance so you have time to finish your rehab or extend your existing mortgage. It is very important that you are transparent with the lender and give them the full picture so they don't feel like there is something they're not aware of. Lenders want to get as much information as possible to feel comfortable with an extension. That's my best advise on it.

It is quite common to have issues with permitting or with the removal of tenants so the lender will understand if that's what's going on. If you're having issues with your GC or suppliers make sure you let the lender know.

Also, there are some cases in which you might be having issues with the lender giving you draws for your mortgage, in which case I would advise to find a new lender so that you can move forward with the project more smoothly.

Feel free to reach out if you have more questions. Regards,

Jackson.

From our experience, when flipping properties the most efficient ways to spend your money are the following:

Focus on kitchens and bathrooms, as these areas consistently provide the most value for your investment. A midrange kitchen remodel has a 96% ROI, costing an average of $27,492 and adding $26,406 above your cost in value.

You could also go for slightly larger rehabs, such as adding a bathroom or a bedroom. For example, adding a bathroom can increase your home's value by 10-20%, depending on the quality and type of bathroom. A full bathroom addition can potentially boost value by up to 20%, while a half bath might add around 10.5%. The cost of adding a bathroom typically ranges from $25k to $60k for a full bath, or $6k to $12kfor a half bath. However, you can expect to recover about 50-55% of your investment when selling the home.

Improve curb appeal, clean up the exterior, add landscaping, and make minor improvements to enhance the property's first impression. Landscaping has the largest ROI (of about 200%), adding a wood deck or a patio will also provide a big increase in value (100% ROI).

Add living space, consider converting attic space, finishing a basement, or repurposing a large living area to add a bedroom without expanding the home's footprint - this will give you an average ROI of around 75%. If you're going for a larger rehab, adding an ADU or doing an enlargement also provides a good return, although it is smaller than what we've seen before, around 50% ROI.

We're a private lender. If you have any more questions or are looking for funding please feel free to reach out to us.

Regards,

Jackson