All Forum Posts by: Magnus Wikström

Hey all,

I'm seeking a GC that can build spec homes in Durham NC. Ideally you've built spec homes yourself in the past and have a house model that is working well for you. You should also be fairly used to working with investors. This is for future projects and to make some new connections. We value honesty and speed and hope to meet someone interested in building more projects.

Best 

Magnus

Hi again Brennan,

Hope you are doing well. US is competitive, that's the downside. As there is much funding available. In less developed markets with less funding available, you'll also find opportunities easier, so in that sense, and as a relatively cash rich American, it can be an advantage. If you don't speak Spanish or Portuguese, I think you'll really have a hard time though as more or less noone speaks english, and you probably want to be sure what you're signing when it comes to legal contracts...

- If it was a bubble, you would have seen a kind of instant response in prices shooting down when the rates went up, which didn't happen, so you can sit pretty safe.

- 100% financing that's well done. That's the way to go. Do you mind me asking which company you worked with?

- Debt is only a problem when the debtors are worried, but if the debtors are fine with the borrower having a large debt, there's not really a problem. It just means that the US has more leverage in its economy. And here are you and I discussing how to get more leverage. It's the same thing. As long as the lenders are fine, we're all fine.

- It sounds like you really want an adventure. Why not go for it then? If the profit is not the main target, why not venture? You'll learn a lot, that's for sure. (Equity partners gives you no leverage though.)

Follow the gut! God has a plan!

@Alex Jacobson I'd be open to discussing. These are typically a little bit tricky to finance but let's have a chat. I'll send you a pm

Hi all, and particularly spec builders

We're an investment team partnering along spec builders, acting as investors in the same spec projects the spec builder is building.

What we favour:

- Short build periods
- Active in areas where cheap lots are available (although not necessarily)
- Young and hungry builders working cost effectively
- Affordable housing builders (not necessarily)
- Track record of a certain house model (not extensive)

If you're interested in building more projects, we are happy to get in touch with you. If you are seeking financing particularly for spec builders, with minimum equity requirements, deferred interest to maturity and low rates we can also assist for your own projects.

Thank you

Hi @Michalis Georgiades,

No one will take second position behind that leverage. We could potentially partner with you if it's an interesting deal, but otherwise we may be able to set up 100% financing, depending on location and numbers. Happy to connect.

Hi @Peter Basnight,

I'd be open to exploring potential partnerships in future deals. Happy to connect

If you're investing for rental purposes, I would also suggest you to use the site numbeo.com, if you don't already do that, which will save you a lot of time searching for and comparing yield markets.

Best of luck again

Brennan, Thanks for your elaborated response.

10 years ago I thought a lot like you, seeking an adventure. I invested in Spain. Bank property. Then another one after that.

Key to success in real estate is leverage. The debt investor you are seeking is the one taking on all the risk. How is he to repossess the property if you can't make the payments. He needs to auction the property after that, with all that involves...

I think as you're born in the US, you perhaps don't realise the market conditions you have. You can't find it anywhere else in the world. If you want to find yields as in the US, you have to go to a market like Lagos, Nigeria to find anything in comparison.

On another note, the US is certainly not in a real estate bubble. We're just coming out of Covid followed by inflation and interest hikes, probably not seen since the 70's. You would have felt the hit quite hard, and house prices would still be trying to recover if there was a bubble during this time. I'm further a real estate economist...

As an investor, arriving to the US is like arriving to the promised land. But it's probably hard to realise when it's all you know and you're a native. I arrived from having lived in Latin America a couple of years, 2 years ago. It's quite a difference you're talking about...

What I know you can make very good on in developing markets is specialized housing types, such as student housing. But this is not for the less experienced developers...

You're right in that developing markets surely has an abundance of opportunities but you probably need to be ready to fund a lot of it yourself, which in the end is gonna hurt your IRR badly.

Re your concern about the US economy, this Bloomberg article could potentially be of interest. https://archive.is/7IEF5 It paints a little more rosy picture

Investing in those markets will give you a lot of experience and an adventure but for the investing sake, it's somewhat hard to motivate.

All the best

what is the built time on the triplex?

Brennan, I would advise you to rethink to be honest... You're creating an uphill for yourself with the lack of available funding markets. You're also exposed to enhanced currency and political risk. I'm a foreign investor focussed on US for a reason. You can't compare the abundance of financial offering to any other market, plus markets with fantastic yield for rentals, alhtough the competition is far higher. But ultimately it's gonna play out on your IRR. I'd really question if it'd be worth it, instead of just looking out of state. Best of luck