All Forum Posts by: Jim Mitchell

Good Morning,

I have found an online auction that I will be putting a bid on and am looking for some guidance. I posted this on another thread as well. 

The home is in an area i am very familiar with so I am confident in the location. The pictures posted look make it look turn key and is being auctioned because of a bankruptcy. From what I can find the owner has passed away. The auction ends tomorrow evening so I don't have too much time. (May 31st)

Facts:

• Comparable sales in the area between a low of $154 to a high of $178 per square foot.
• This home it looks like it could get between $257k and $296k.
• Auction starting the bid at about 100k with 50k bid increments.
• I have about 150k I could come up with another 50-75k (getting creative)
• If I don't want risk putting down the cash may finance some (above 100k)

Questions:

What would concern you about this auction?

What would you do first to ensure your concerns were put at ease before bidding?

What flexibility do i have in making a bid but not being locked in based on something that could go wrong (legally or otherwise)?

What should i be doing looking for before making a bid or committing to purchase and sale?

What other advice do folks have

Thank you very much for your help

Good Morning,

I have found an online auction that I will be putting a bid on and am looking for some guidance.

The home is in an area i am very familiar with so I am confident in the location. The pictures posted look  make it look turn key and is being auctioned because of a bankruptcy. From what I can find the owner has passed away. The auction ends tomorrow evening so I don't have too much time. (May 31st)

Facts:

• The Auction is starting at 100k with 50k bid increments
• Comparable sales in the area between a low of $154 to a high of $178 per square foot.  
• This home it looks like it could get between $257k and $296k. 
• I have about 150k I could come up with another 50-75k (getting creative)
• If I don't want risk putting down the cash may finance some (above 100k)

Questions:

What would concern you about this auction?

What would you do first to ensure your concerns were put at ease before bidding?

What flexibility do i have in making a bid but not being locked in based on something that could go wrong (legally or otherwise)?

What should i be doing looking for before making a bid or committing to purchase and sale?

What other advice do folks have

Thank you very much for your help

@Matt Lefebvre I am just beginning the marketing and have 2 target areas (one in NH and on in MA). I am trying to line up cash so that I can come in with a cash offer to contract. The goal would be to line up another cash buyer and assign it so that I don't need the financing,  however for the right property I would consider keeping it as a long term rental.  Right now for smaller deals (under 100k) I have what I need for cash now. It would be for the greater than 100k deals that I would need the potential financing.  Also, I expect the properties in MA (on Cape Cod) will command bigger dollars where I would need the financing. I have been given the suggestion to take out a home equity line on both my current properties to generate additional cash that would give me quite a bit more flexibility than i have now. 

Any thoughts or suggestions you have would be much appreciated. 

Jim 

Thank you Ann!

Thanks @Matt Lefebvre, I am open to flipping in both NH and MA. NH. When i say private $$ thinking more hard money lenders. Open to going in on deals with investors as well. If you know of any investors i can connect with where I can bring any potential deals let me know. Open to trying what ever options the increase the likelihood of a positive result +$ 

@Shaun Reilly thanks for the leads. I just put the Black Diamond meeting in my Calendar. I have listened to the podcasts (some more than once). I am also meeting with a friend of the family who is a broker to get some guidance. My education is in full swing. 

Thanks again

Thanks Michael, great advice I really appreciate it. I have been contemplating getting my broker's license so that I could at least understand how it works. I also am vetting a few contractors so that i can at least get some estimates on fix and flips in my area. I am not a handy person so for me I will need a good contractor. I already have an accountant and attorney. I will be figuring out how to set it up LLC, Corp etc and have meetings set up. Love the buy now transfer later suggestion so i can at least get the ball rolling. I already have a couple of target homes that I want to test the process with. I figure test and learn is the way to go and i am sure i will make some mistakes. The financing is the piece I will need to get down. Going private seems really expensive but easier, going with traditional is more complicated and more red tape. I was reluctant to go private lender but thinking on my first flip i would try it.

Thanks again for the advice! 

Good Morning! I am new to Bigger Pockets and I look forward to engaging on these boards for the mutual benefit of myself and others who I can share my experience with and help. I have already learned a ton from listening to the podcasts and reading various articles. Now I need to get going.

10 Year Plan: To secure 5+ fully paid for short term rental properties on Cape Cod so that I can retire from my full time job and spend time enjoying life with my family.

15 Year Plan: Pay for home in Costa Rica (to get out of New England in the winters:-)

I currently live in New Hampshire and have another home in MA. I am primarily looking at Realestate in MA but am open to either state as the opportunities present themselves.

Current State:

1 Primary residence in NH

1 Second home (that has turned into a rental property) on Cape Cod (Dennis MA)

• Currently generating 18-20k per year through short term rentals

Preliminary Plan to get there:

• Find mentors by starting conversations with those who have done it (GET STARTED)

• Begin by flipping a house or 2 per year using some of the wholesaling strategies I have learned so far.

• Take profits from these flips to pay off first rental property mortgage.*

• Purchase second of 5 long term rental properties use income from first to pay loan of second.

• Repeat…

*If these intended flips can generate cash flow positive returns will keep them as long term rentals (focused on short term rentals only)

I am open to any feedback, suggestions and criticism that anyone may have on my plan above or if anyone is interested in mentoring please let me know.

Thanks again for the support. I appreciate all that I have learned from those on these boards so far

Sincerely, Jim

Here is how I started. (And looking to expand). I started looking where me and my family vacationed. (Cape Cod). Went in the the intent of buying as a second home and to rent out part time in the summer to help pay mortgage. I had zero plans to be in the real estate business nor did I intend to build wealth doing it. I researched the homes I was interested in by searching the county records for thing like leins, what the owners owed on the property vs their price to help me determine what to offer. Also checked with a local realtor to find out what I could get for weekly rates in the summer and the occupancy rates. I also had friends who knew another broker who specialized in renting out cape cod homes in the winter( that's a bonus on the cape as it tends to be a June- sept vacation spot). I went to the town web site and pulled all their town finances to see how likely it would be that the taxes would remain low. This town was generating millions in tourist fees each year and owned its own golf course which was very profitable. I also searched on google news articles on the area and it (as I already knew) was very popular with families. The issue I ran into was my property was about 1 mile from the beach but in a great location with nice landscaping and clean space that could sleep lost of kids. It is small (1400 sq feet) one level and easy to maintain. I realtor had other property closer to beach that would rent in the bumper months(June, Sept and OCt) so I started using Airbnb which has been huge and has allowed me to generate an extra 5k +per year in income in addition to the 13-14k per year we generate. We bought the home for around 400k and put down 20%. We could make another 3-5k per year if we did not use it and rented it out including other days we are there when we maintain the property. We use the home 2 weeks in the summer for ourselves for vacation and has helped us build awesome memories while helping pay a big portion of the motgage. Now I am interested in expanding but this time to go cash flow positive. If you can think of anyone who can help let me know. I hope this has been helpful. Jim