All Forum Posts by: James Cox

@James Cox I’m a bit late to the party. Lesson- read entire thread before posting

@Nicholas Weckstein super frustrating to deal with. Try and keep in mind that an appraisal is an opinion and opinions aren’t right or wrong - just well supported or not well supported. He or she should have a clear and valid reason for not being able to use the basement. Suggestion- try and find a better comp even if you have to go back in time. They should be able to make a Date of Sale/time adjustment (if warranted) making older sales viable. It’s also likely that this appraiser may not know how to do that and may need help. As for the appraiser being too prideful to change or having some vendetta- probably unlikely. Most appraisers don’t want their opinion to be lower than contract. Usually when this happens, or it’s tight, the appraisal takes at least twice as long because they are looking everywhere and trying everything to make it work all the while knowing that they need to be able to defend their report to a reviewer, investigator or group of peers. A report coming in under contract means the phone will start ringing, emails flying and not-so-fun heated conversations to be had. Trust me when I say this - Appraisers just want to deliver and move on. If my opinion comes in lower than contract I am sincerely hoping somebody can bring me a relevant comp that supports. One more thing- if the pending contract price is within the adjusted range of values, this can be reason to give more weight to the pending contract price because it’s ‘real time’ indicator of a market transaction between what I’m assuming to be an equally motivated buyer and seller. Further, if market indicators point to an increasing market e.g. demand is high, supply low, absorption rate on the rise, and there are pendings and actives that after adjustments support the contract price- then all of these pieces should be enough (IMO) to support the narrative that the opinion should be higher. Be diplomatic, stick to topic, don’t bring up extra bs like typos or a missed covered patio - only the relevant stuff. You may also let your loan officer do the communicating. That’s what I did on a recent reconsideration and it worked. Good luck!

@David Lilley Thanks for the tip. I’ll get in touch

Hi all, We have a semi light rehab on a rental we’re selling on an 1,100sf house in Dallas. Thought we’d reach out here 1st for referrals.

The updates will consist of flooring, cabinets, countertops, hardware, fixtures, appliances, light plumbing/electrical.

Thanks!

@Austin Adams It's hard to ignore the ROI on an ADU but it may cost more to build than the value it adds to your property. We're hoping to build one this year in spite of that. Warning though- if you're ever thinking about moving, some areas won't allow two separate leases on one property which could limit legal cashflow.

@Tishon Greene every market is a bit different but it might be a wash. Positive adjustment for the extra GLA, negative adjustment for lack of two car garage. Shouldn’t require a full appraisal. In my market we might charge a small consulting fee $100-$200.

@Kimberly Kesterke There’s a lot of good advice here. I lean more towards follow the law of the lease with no emotion. Also, no self deprecation, only lessons learned and stoicism but that’s easy for me to say.

Sometimes doing a sort of thought experiment and pretending like you’re having to step in and solve a problem for somebody else can bring things into focus and lighten the situation. You may quickly realize that the only thing you have control over is how you enforce the lease. Everything else is a waste of time and energy.

BTW- kudos for being so honest. I don’t know that I would’ve shared all that. “Respect” in Ali G voice, And Kudos to BP community for being so nice

I've seen a few wholesalers grab the cherry deals to rehab. But I think the real reason is because many of these rehab deals are mediocre and require a better plan, budget and management than most people realize. Without good systems and execution a homerun can turn into a flop. It was baptism by fire for me and my partner when we decided to try and flip one. We could tell you what the ARV was all day long but beyond that we had to take our lumps with managing contractors, being naive, bad scope of work, bad systems, not visiting the property enough you name it. Once you've done a few flips or flops you realize quickly why construction management is a full time gig and can pay well. A fair amount of the assignments that come across our desk don't seem like they have much meat on the bone and when you look at some of these rehab budgets you scratch your head at how conservative they are. We give ARV opinions to HMLs and never really see what the project truly cost only the projected pie in the sky numbers and maybe the final sales price IF we happen to remember to flag the deal and look up what it sold for. There aren't too many we see that are cherry. But at the same time, we don't have a construction team and systems in place so what may look like a mediocre deal to us or a wholesaler could be a sweet one to the pro.

@Whitney Anne Kwek I honestly don’t think I would’ve finished Think and Grow Rich if it weren’t for Audible. With that said, there were a few takeaways.

@Nathan G.

Traction-it’s a business book about processes and systems

The Body-Bill Bryson