All Forum Posts by: John Choi

The construction cost has been soaring in the last 3 years in the Bay area (I work in the corporate construction industry and our project management office is forecasting 10% fee escalation in all of the MEP trades in this year). In residential market, I learned that the national average GC's profit is ranging between 7-8% (excluding overhead) for new construction. I am wondering how much average GC's mark-up is in small residential market in the bay area in these days?  In other words, how much do you expect to pay when you hire a GC for a full rehab project?

Your answer is appreciated.

Thank you 

The construction cost has been soaring in the last 3 years in the Bay area (I work in the corporate construction industry and our project management office is forecasting 10% escalation in all of the MEP trades in this year). I am wondering how much average GC's mark-up is in small residential market in the bay area in these days? In other words, how much do you expect to pay when you hire a GC for the full rehab project?

Your answer is appreciated. 

Thank you 

@Thomas Franklin Thank you Thomas. This is very detailed and thorough information. I have a similar cost breakdown spreadsheet I have created (Please see below).  Below is my cost analysis of the property I am currently looking at in downtown San Jose. The property is listed at 440k and my ESP based upon my comps of 10 houses within same neighborhood is 610k. The property has 7,000 sqft lost and has a tenant already living in the house. I just used 60k as my ballpark number for the improvement cost based upon my assumption that the the house does not need any structural improvement. 

Would you mind looking at numbers in my ROM cost breakdown below and see if it makes sense? 

1274 Vine St San Jose, 95110 - $439950 / 3 bedrooms, 1 bath/1 story/Built in 1948/Lot Size: 6848

Thank you 

John

I am a construction manager and also a newbie investor looking for flipping opportunities in the south bay or east bay area and the investors who also have interest in flipping as well.

Since I have a full-time job and cannot directly hire and manage subs on a daily basis, I want my business running on autopilot. I believe I need strong tools to negotiate with the GC whom I will hire and double check his performance on a weekly basis (ex: spliting payment as he hits each milestone or pass each inspection from COSJ building department. I believe there is a total of 7 inspections including Building Final if you start out new construction. The number of inspections vary depending upon scope of work), so I started building the platform including the comps, ROM construction cost estimate and schedule templates, bid and contract packages, etc. I am still not familiar with doing comps, lending and selling process. Hope you don't mind answering my following questions.

1. In San Jose market, what kind of house style and design would contribute to selling houses quickly? Are there any special amenities attract the buyers' attractions?

2. When you drive other houses in your comps, what other creteria you are also using to do visual inspection except for house condition, curb view, street and proximity?

3. I think someone said in BP Podcast that some people do file LLC per each deal. What are the benefits of filing LLC per each deal if you are working with other investors?

I am a construction manager and also a newbie investor looking for flipping opportunities in the south bay or east bay area and the investors who also have interest in flipping as well.

Since I have a full-time job and cannot directly hire and manage subs on a daily basis, I want my business running on autopilot. I believe I need strong tools to negotiate with the GC whom I will hire and double check his performance on a weekly basis (ex: spliting payment as he hits each milestone or pass each inspection from COSJ building department), so I started building the platform including the comps, ROM construction cost estimate and schedule templates, bid and contract packages, etc.  I am still not familiar about doing comps, lending and selling process. Hope you don't mind answering my following questions.

1.   In San Jose market, what kind of house style and design would contribute to selling houses quickly? Are there any special amenities attract the buyers' attractions?  

2.  When you drive other houses in your comps, what other creteria you are also using to do visual inspection except for house condition, curb view, street and proximity?

3. I think someone said in BP Podcast that some people do file LLC per each deal. What are the benefits of filing LLC per each deal if you are working with other investors?

Hello,

I am a newbie investor living in San Jose, CA. I am interested in buying rental properties in Houston TX for cashflow purpose.

Would you give some insight about the housing market in Houstron? Also, what would be the best option for getting a low interest mortgage when you buy distant investment properties?  

Thank you

I am a construction project manager working in Palo Alto area. I saved up some cash enough to do my first real estate project. Currently, I am thinking about buying and flipping a house in East Bay area using my connection and construction resources. Looking at the housing market, I was also thinking about buying rental properties out of state but am concerned about another downturn in the real estate market even if I bought a rental property at a reasonable location and would get 12% + cash flow.

I am still not sure which option will be the best fit for me: House flip in East Bay vs buying rental properties out of state.

Would you please share your experience and expertise if you have done any flip projects in East Bay?

Your comment is much appreciated.

Hello, my name is John. I am currently working as a project manager for the construction company and also a newbie investor living in San Jose, CA. I am currently looking to purchase my first rental property in Sacramento area or out of state if possible. The main reason why I have decided to look for distant properties is the current state of the bay area's housing market where the prices of SFR are around or over 1M. I am interested in house flipping, purchasing rental properties (SFR, multi-family homes, etc) to generate cash flow. For house flipping, I am also looking forward to utilize my construction background and expertise.

Hello, my name is John. I am currently working as a project manager for the construction company and also a newbie investor living in San Jose, CA. I am currently looking to purchase my first rental property in Sacramento area or out of state if possible. The main reason why I have decided to look for distant properties is the current state of the bay area's housing market where the prices of SFR are around or over 1M. I am interested in house flipping, purchasing rental properties (SFR, multi-family homes, etc) to generate cash flow. For house flipping, I am also looking forward to utilize my construction background and expertise.