All Forum Posts by: Shawn McCormick

@Adam Marx what are you intentions with the property? Is the ARV to flip or to buy and hold? You said 'I'd put ARV safely at 225-275'. That is far to big of a spread, you need to be much more accurate especially if you are flipping it.

Some things to consider if you are flipping. Maybe pay for an appraisal up front or if you are financing, the lender will do one and if it doesn't appraise, you can walk away with no consequences other than your time. Are you working with a Realtor® or a contractor, both can likely solve your problem as the agent will have access to more data and knowledge of how to run comps, the contractor will be able to give you a better idea of repair costs. Then tell the agent to run comps for ARV based on updates you do.

And you also said you can't afford to lose $20-30k, the most seasoned flippers/investors lose money all the time, and ultimately that is part of your education costs, hopefully you don't make any costly mistakes, but you have to run your numbers well enough to make sure there is some 'ooops' fund to help shield you from that.

As for comps, typically, appraisers want them to be in the same neighborhood, within 15% same square footage, same # beds/baths and age. If they can't find those things, they will go out a little further (start at 1/2 mile, then mile and so on) Then they will make adjustments to bed/baths/sqft. Say yours is a 2 bed/1 bath all other comps are 3/2's. They would subtract the value of a bed and a bath, maybe $7500 for a bedroom and $5k for the bath and then factor the same for other things like pool/no pool, 1/4 acre vs 1/2 acre and so on. So you can do the same thing, but you have to know what a bedroom is 'worth' in that area. Some areas a bedroom is $5,000, some $10,000.

Something else you could do since the property is off market, is negotiate with the seller to bring them in the deal. I'll pay you 'X' and also X% of the profit when I sell. So the better you do they make more too. But if your ARV is way off or you finish the flip 5 months from now and the market has shifted and you don't make much, neither do they. Lots of other ways to structure those too with the seller, thats just one example.

Best of luck, keep us posted!

@Sejin Kim you will definately want to be there for the final walk thru, especially if the tenants will be out before closing so you get a true picture of the condition after they remove their belongings. If they are going to be there post closing, at minimum have your agent do a final walk and take photos and video as you will now be the landlord and responsible to hold them accountable for any damage, so document.

Once you get it up as a STR, you should go at least once a quarter to make sure cleaners are doing a great job and make any needed repairs or adjustments. I recommend spending a couple nights in the unit so you have the perspective of a guest to notice anything you are missing or need and develop a check list for your cleaners and/or property manager.

Your agent should be advising you on all of this and more and have local contacts for you. 

@Rabia Khan congrats on getting started. Others have touched on this, but there are several factors to help you decide. Affordability..are you approved for a loan (what type) does lender know you are looking at condos? If you are shopping single family vs condo, the HOA fees for condos could take it out of the running. The condo association must be solvent and warrantable, meaning they must have good books, cash reserves and also be under the threshold of owner occupied vs investor owned units. If too many investors own in the complex, you will likely not get the loan for that community.

There are lots of basic calculators online, including right here under the 'tool' tab at the top to help run numbers to see if the deal makes sense. Me personally, I don't like condos at all. There can be assessments for windows, roofs, siding etc that will kill cash flow, the HOA fees generally make the numbers not work and if the fee is too low, it's likely in an area you don't want to own in. They don't appreciate in value like a single family would and when you go to sell, it will likely be to another investor that wants it cheap too. I would suggest trying for a single family, your demographic of renters are better, values rise faster and you will have a more diverse renter pool.

Best of luck!

Quote from @Alyson Gordon:

Quote from @Shawn McCormick:

Hi @Ndu Nwachuku not sure where you got your information from, but I can say pretty confidently that area will not be getting any improvements and values will not improve commensurate with the rest of the Orlando MSA. 

Proximitity to key attractions? You mean the 33rd street prison? The fairgrounds? or the ghetto areas like Parramore? If you are thinking short term rental because Universal studios is fairly close, you can't STR in Orange County, so that is out too.

I wish you the best and maybe there is something that I'm unaware about, but nothing I know of. 

I love this honest response! I lived in Orlando years ago and not having local knowledge of neighborhoods can be tricky. Do you have any insight on the Paradiso Grande community being built?

 Hi @Alyson Gordon I don't know much about Paradiso, but it's in Orange County, which doesn't allow Short term rentals, so not sure of ownership type. If you are looking for STR communities, there are many that I could recommend near Disney. They are mostly in Osceoloa county, some in Polk and Lake.

Let me know if I can answer anything else. 

Quote from @Christian Timiraos:

Quote from @Shawn McCormick:

Quote from @Christian Timiraos:

Ive been trying to post FSBO on zillow for 2 weeks in Central Florida. Ive submitted the Land on there website and all it says its " they will contact me in 2 business days but never get contacted. Ive apply on two different accounts and sent customer service emails and no response.

Has anyone had trouble posting a FSBO on Zillow either?

Have you ‘claimed’ the house as yours on Zillow. Once you own it, you should claim it. I don’t think the cross reference with public records, but maybe that doesn’t match or something?
this is just another reason to use a Realtor….or at
minimum use a flat fee service so it gets syndicated out to all the sites.

I got it from a tax deed and propstream shows im the owner of the land already. I also didnt know I have to claim the land on zillow. I though it was just Post it and thats it from zillow. Would you  recommend a platform that would allow me to pay to have it posted

thanks for the information btw

 When you go to Zillow, put in your address and in the upper right corner you have "edit, save, share & more", click on more and then a drop down menu has 'claim as your home'. 

Call Rob at Sandollar Realty in Orlando, he does flat fee listings and can help you out, he is an extremely seasoned investor and broker. Just noticed that you are saying land, so there is no home? that could be the issue, but not sure. I've got several land investors that I could probably get it sold for you. PM me the details and I can send it to a few people. 

Give Doug Fudge a call (Fudge Insurance). Many of my clients use him, not sure about rates, but he understands STR and what is needed. I tend to say no to the wind, but look at costs vs coverage and the language used.

Best of luck!

@Aaron Washington Depending on what community you are in, I know its not one of the big resorts if you only 4 beds, but do you have a clubhouse..does it have an arcade? All of the resort communities have arcades, some have movie theaters and more. You absolutely want to convert it to gaming/entertainment...do not turn it to a bedroom, there are 10's of thousands of STR in the area and none use the garage for bedrooms. IMO, pool tables, ping pong and air hockey are tired, you must have a wow factor of some sort. One of my clients just converted his garage into a mini put put with a Star Wars theme..truly one of a kind. He and his dad built it, so if you have some imagination and skills, you can DIY.

I would go on one of the booking sites and look at what others have done and get some inspiration. You have to be creative and give your guests something to rave about with so much competition. I agree with others about nostalgia, but would work in both that and xbox. If you have a loft or bonus room, maybe make that area adults..multi game video, pinball and poker table and make the garage for the kids and a mini split is a must. 

Best of luck

Quote from @Jonathan Krauser:

That is correct - I would get $3,000 a month for a $300K purchase. 

1. Currently the property is not being homesteaded so maybe it will go up a little more. 

2. I have two points for the mortgage. Should I be counting the up front escrowed money for my analysis? 

3. I am replacing a roof, replacing a 2 ton HVAC and the electrical panel.  

I am looking at this purchase for cash flow.  

So

Taxes will go up, but depends on how long previous owner owned it. Since you can’t Homestead either, it will go up the max. Call the county or visit property appraiser site, many have calculators.

The points should be counted as well as the escrows for taxes and insurance as that is all out of pocket expenses, not financed. That's if you want to analyze COC returns.

Those replacements will definitely add more than $ for $. An appraiser would give weight to a new roof and panel, insurance will be lower for a buyer and they would pay more knowing it has those items and they don’t have to do them. Check comps to see if they have new roofs, a/c etc. if a comp is selling for $300 without those things, yours is worth more.

Quote from @Christian Timiraos:

Ive been trying to post FSBO on zillow for 2 weeks in Central Florida. Ive submitted the Land on there website and all it says its " they will contact me in 2 business days but never get contacted. Ive apply on two different accounts and sent customer service emails and no response.

Has anyone had trouble posting a FSBO on Zillow either?

Have you ‘claimed’ the house as yours on Zillow. Once you own it, you should claim it. I don’t think the cross reference with public records, but maybe that doesn’t match or something?
this is just another reason to use a Realtor….or at
minimum use a flat fee service so it gets syndicated out to all the sites.

Hi @Ndu Nwachuku not sure where you got your information from, but I can say pretty confidently that area will not be getting any improvements and values will not improve commensurate with the rest of the Orlando MSA. 

Proximitity to key attractions? You mean the 33rd street prison? The fairgrounds? or the ghetto areas like Parramore? If you are thinking short term rental because Universal studios is fairly close, you can't STR in Orange County, so that is out too.

I wish you the best and maybe there is something that I'm unaware about, but nothing I know of.