All Forum Posts by: Janelle K. Eagle

@Michael Ruvido - DONE! messaged you and would love the referral. 

Hi @Matt Sora, congrats on pursuing your first fix and flip! It sounds like you are still in the education phase, so you're doing the right thing by going out and asking questions and sourcing through other people's experience. You should become an expert on your target market and really start to understand what properties are selling for and WHY they are selling for that amount. Questions you can start to ask yourself when looking through comps:

1. What is the average price per square foot being sold of three similarly priced properties?

2. What are the standard amenities that are provided in this area? 

A local realtor or REI group might be able to help you ascertain what the "going rates" are in your area.

With regard to "making sure you don't lose money," the best way you can avoid that is making sure that you get a deal that is SO FAR BELOW MARKET VALUE that WHEN (not if) something unexpected comes up that you didn't budget for, that you will still make a profit. Every guru will offer a different formula, but one that is commonly used is: 

70% of the ARV - Repairs = TARGET PRICE

To break that down, that means once you calculate the ARV (After Repair Value) that a property would sell on the market for after your flip is complete, you want to multiply that amount by 70% and then subtract the total cost of your projected repairs. For example:

If you find a property that would sell for $1M and needs $100K in repairs your math would look like this:

($1M x 70%) - $100K = Your Target Price

or 

$700K - $100K = $600K. 

If you can get the property for $600K knowing that you can PROBABLY sell it for close to $1M, then you are setting yourself up to make a profit, even if something goes wrong. 

Hope this helps!!!

@Scott Mac they did provide a breakdown, and that was the sum (just under $13K). It was $1,500 each for the LLC formation, which just feels SO EXPENSIVE to me! I created two online for free, but of course know that the bylaws and structure have to be particular in order to ensure the asset protection. I'm willing to pay for that sort of expertise, but just couldn't fight the feeling that it was more than others who are equally qualified might cost.

Hi @Ricky Loza, I'm a realtor and investor in nearby Los Osos and would love to know how this is going for you. Are you still renting out your property in Cambria? 

Hi There -

I just got what feels like an exorbitantly high quote ($13K) to set up a Wyoming Holding company and two LLC's (California) from Anderson Advisors. That is separate of the $800 each to operate the LLC's and then $1,400 annually to manage all of those.

I'm always happy to pay for professional services and believe in investing in my business, especially in order to ensure it is set up and managed properly. 

Am I crazy that this is at the very top end of the market on costs? Can anyone recommend an alternative service?

Woo-wweeeeeee. That is a massive home that needs A LOT of work! Curious what the ARV or comps look like in the area? So much potential!!!

@Nicholas Doyon - curious what you've learned or decided to do in the last six months since this original post! Where did you net out? Still renting or did you find an investment opportunity? 

Hi @Andrea Ochoa - based on your location in the CA Central Valley and the questions you are asking about which option might be best - I suggest reaching out to Conventus. Their team, especially Alli Machacek, in particular, is fantastic about helping you walk through options in order to achieve your individual goals. Best of Luck!