All Forum Posts by: James A.

@LaShonda C Torbert congratulations!  Learning the construction piece can be a steep learning curve.  Be proud you are marking the decision to take action!  Absolutely network and ask around when you get information, Baltimore real estate community is very active and make sure to join the facebook group maryland investor network. 

@Alexander Spira gathered a listing of contractors that work baltimore.  If you still haven't found one.

@Ari Bachrach Thank you the great information above! Just curious what your opinion was about the accuracy of their ARV and their reno budget?

@Eugene Choe Congratulations on making the decision to take action! I would challenge you to set your goal sooner, BP has the 90 day challenge but even 6 months wouldn't be bad. I don't focus on rentals but meetup website has alot of groups for real estate investing Baltimore REIA does have a membership but when i first started I paid to be a member for year and was totally worth it. You meet a lot of people and I have learned the more people you have to go ask questions or bounce ideas off of will make the process a whole lot easier. You have so many parts when it comes to real estate it is good to have multi people to go to when you run into a problem. Good luck and keep us updated!

@Thomas Breedlove thank your friend for their service!  If your friend is in the Baltimore area, he can check out a Flip i am doing in Fells Point.  Chap property and added a 2nd story addition.  Definitely encourage him to attend local meet ups and network.

@Tyreese Brown hope all is going well with closing on your next property!  I can give you my advise on Chap, but I utilize it from a fix n flip view and I see your title says you are rental investor but might come in handy to keep your taxes down.  I personally like using a Chap consultant.  I pay $1200 for my guy and he takes care of all the paper work also consults if i have any questions about what is or isn't allowed.  The process with him takes about 4 weeks to get the initial approval.  You usually submit your intention for any renovations and he proposes any changes that you might want to make on the property, chap requires certain things to be kept or certain requirements to achieve chap tax.  An appraiser will then do an as is assessment of the property.  It is important that you not start any work before the assessment you will disqualify yourself.  Again another benefit of the consultant they will let you know when you can start and what things you can do.  Once you get the OK you are free to do your renovations they will have a detailed report of what you can/can't do.  Once you are done with the work, the consultant will complete the application and you get the approval.  

*The good and the bad  - good you get the freeze on taxes for 10 yrs, in baltimore city where taxes are notoriously high this can save you alot it also stays with the property so if you sell the new owner will continue with the benefit; good selling/marketing feature.  The bad delay in time while you wait for the approval and you might be limited by certain things you might want to do with the property.  I personally have never tried to put the application in myself and feel the value of the consultant is worth the money, but if you are on a tight budget $1200 might be alot, i think some others might be cheaper.  Hope above was helpful!

@Ozzy Sirimsi Thanks!  Sorry i thought the pics did post but if you go on zillow or redfin or just google the address 1815 Gough St. should be able to see the finished product.  Here a few pics

@Caleb Jordan congrats on doing a live in flip hope you guys had success.  The bank did qualify based on income and assets had to submit tax returns the whole nine yards and even had to write a letter about my experience.  They call it a master line of credit but it was a bit misleading they still fully underwrote the asset, meaning I still had to get an appraisal done at at my own cost.  But the positive is the cheap interest rate and they only charge interest on outstanding amount.  So you dont get charged on the money for the construction until you draw on it.

Investment Info:

Single-family residence fix & flip investment in Baltimore.

Purchase price: $96,000
Cash invested: $34,000
Sale price: $340,000

The renovation was a full three story bump out. The traditional rowhouse was originally 780 sqft the renovation involved adding roughly 900 additional sqft and opening everything up with a master bedroom and bath on the third level. Spent about 140K in the renovation. I also took advantage the the Chap tax credit the city offers to keep the taxes frozen at the as is value for 10 years which stays with the property and benefits the buyer.

What made you interested in investing in this type of deal?

The opportunity to create alot of value.

How did you find this deal and how did you negotiate it?

Found on CL, reached out to the person who posted the ad.

How did you finance this deal?

Local Bank

How did you add value to the deal?

Added 900 sqft of additional space and opening up the floor plan

What was the outcome?

Purchase price was 96K spent 140K in scope of work, spent 13K in financing costs and $17K in realtor commission. The sale price was $340K gave the buyer 5k in closing help.

Lessons learned? Challenges?

Dealing with the permits and approvals in Baltimore City. Also had some challenges with the contractor staying on a time line. At the end of the project actually had a subcontractor flood the house the day before the house was suppose to get the listing photos taken.

@Will Bowman congrats!  I commend you for taking on such a large project!  The picture looks like you did a great job and obviously the appraisal justifies the great work you did!   Did you do any of the work yourself or was it all contractor work?