All Forum Posts by: Lorenzo Spurrier

I'm interested in purchasing a property to demo. I initially had the idea of renovating the home, but when I realized it was actually not a possibility my mind changed. The highest and best use of the subject property would be to demo it.

The home sits in a highly populated area, off of one main road which has a fair share of traffic. It is sitting on .5 acres of land. There appear to be similar lots nearby on the same main road that have brand new homes. (Including the home right next door)

The ultimate question I have: What ways can I fund a project like this?

Has anybody done a similar project, and used a certain way to fund it? Did you use your own capital? Did you use a bank? HML? Private money? What's the best approach?

Do you think this is a waste of time? Have you tried this and has it gone well or has it gone sideways? I'm looking for opinions and constructive criticism so I figured the internet is the only place I can rely on for that. All feedback and comments are appreciated. Thanks!

0 Votes

Originally posted by @Frank Wong:

Hi Lorenzo,

I think you gotta see the property in order to make the correct offer. Wouldn't you waste more time putting in an offer getting it in the contract and having to cancel because it was not what you expected? Pictures only show so much.

You are also a realtor and buying it for yourself. Like Grant noted do you really want to shoot yourself in the foot in your own industry and be that guy? As you know reputation in the broker side is everything. Agents know other agents.

Look at it from a business standpoint. You get to drive the properties to see the inside and know the quality of them. This information is valuable when working deals for yourself and for your future clients. When a client calls me about a house I can tell them all these intricate details about it that they wouldn't know if they didn't talk to me. These details save my clients time by not seeing properties that they would have if they didn't speak to me.

It's never a waste of time when you look at it from a different perspective.

Well put sir. I agree with you and appreciate your response. Thank you

0 Votes

Originally posted by @Eric M.:

It is not a matter of if it is a good strategy. it is just a different strategy. It simply becomes a numbers game. If you vet the number and inspect a house like previous you may need to look at 20 to buy 1. If you do it the shotgun way, you probably will send 200 offers before you get anything remotely close to becoming a deal.

Just know that a lot of people already do this shotgun style and it is very annoying for sellers. There are guys in my area who send a half price offer on every single listing. I think it is idiotic but it must work some percentage of the time.

Good point. Do you think if someone made a more educated offer, the "shotgun method" would be more effective? If you're presenting offers half of the listing price, sounds like there's not much thought or due-diligence put into that. Have you tried the shotgun method personally? Thanks for the comment

0 Votes

Originally posted by @Mark Trebor:

I think this is a common tactic used especially in a hot market. But.... you can only back out of so many deals before the realtor you are working with might not want to help you anymore. You're now wasting his/her time as well as yours so tread lightly. I have a good working relationship with my Realtor she knows what I want sends me the listing and if I say I am interested she ask the seller for permission to video tape the property she share the video with me and then we decide if we are going to make an offer based on that info. I buy houses 100+ miles away from where I live so checking out every house in person is not feasible. I think the last 6 houses I never set foot in until sometime after owning them.

I'm a realtor, so I'll be writing offers, and dealing with the other side... (and saving myself a buyer commission) With that being said, Is this a good strategy? It's hard for me to see anything I have to lose by making these "blind offers". Thanks!

0 Votes

I'm working on getting my first fix and flip out of the way. I went through the MLS, found some interesting properties, scheduled showings and visited these properties. Out of all the properties I went to, there's only about 2 or 3 that I'd considering making an offer on, that I found to have potential. I felt like a lot of time and gas had been wasted walking through these properties.

I have another idea to prevent wasting time/money, that I think may be better but I'd like some opinions on it...

Would it be a bad idea to make offers based off of photos/virtual tours, if said offer gets accepted, use my inspection period to walk through and either go through with it or back out? Is this unethical? Is this a horrible idea? I'm looking for opinions. If you think I'm a straight up moron, tell me. Don't worry about offending me I have thick skin. Thanks!

0 Votes

Originally posted by @Raleigh Lewis:

I am going through the same problem.This will also be my first property, my credit is around 610 because of student loans and most of the HML said these where my main problems. I was able to find an ABL(asset based lender) but there terms are similar and all of the lenders asked me to come up with at least 15k for closing.In my opinion the terms your lenders are offering arent that bad depending on what you plan to do with the property,arv,noi,cash flow, etc.?.? I hope this helps!! Good luck!! @Lorenzo Spurrier

Hey, It's going to be a fix and flip so I'm shooting for the highest ARV and lowest purchase price. I appreciate your input and I wish you the best of luck as well sir!

0 Votes

Originally posted by @Caleb Heimsoth:

Originally posted by @Lorenzo Spurrier:

Originally posted by @Caleb Heimsoth:

@Lorenzo Spurrier. If you’re paying that kind of money, I need to get into the HML business. Lol

You should. Seems like you know of a good HML you could refer me to?

Not specifically. My main point was that’s a lot of interest and fees to pay in order to flip a house. Better make sure you have some wide margins when doing that.

I see. Thanks for elaborating, sir! May be a dumb question, but out of curiosity - have you done a fix and flip personally?

0 Votes

Originally posted by @David N.:

I think those terms are very reasonable for a newbie investor. Most lenders would not fund 100% acquisition and 80% rehab for a first time flipper. Congrats on your first flip.

Best,

Dave

Thank you, Dave

0 Votes

Originally posted by @Caleb Heimsoth:

@Lorenzo Spurrier. If you’re paying that kind of money, I need to get into the HML business. Lol

You should. Seems like you know of a good HML you could refer me to?

0 Votes

Originally posted by @Daniel Sisto:

@Lorenzo Spurrier The costs above in regards to HML for a first time borrower are very common. The more you begin to build a reputation and track record of successfully paying back your lenders, the less expensive the money will become. Just make sure you have all of the HML costs accounted for when running your analysis to determine your purchase price.

Let me know if I can be of any other help to other questions.

Thank you, sir! That's exactly what I was wondering.

0 Votes

All Forum Posts by: Lorenzo Spurrier

Lorenzo Spurrier has started 4 posts and replied 15 times.

Post: Buying A House For Demo?

Post: Making Offers On Investment Properties

Post: Making Offers On Investment Properties

Post: Making Offers On Investment Properties

Post: Making Offers On Investment Properties

Post: Cost Of Borrowing Money

Post: Cost Of Borrowing Money

Post: Cost Of Borrowing Money

Post: Cost Of Borrowing Money

Post: Cost Of Borrowing Money