All Forum Posts by: Matt K.

Be careful with detailed scopes....don't get to the point where you tell contractors how to do their job, that's where you get change ordered to death over dumb stuff....

Instead, make sure the intent is detailed and clear.  Something as simple of remove and replace existing fence instead of repair. If you start calling out materials and the like and you come up short or the contractor can't "complete" the task they'll change order you for those mistakes. 

Let the contractor call out the technical details in their quote along with materials. Then you can review/go over them there and sort it out...also use it to evaluate bids as some may be better value vs others.

@Jay H.

So, going to start off w/ I only know the KC market well.... so this advice is based around that and probably applies to all the other popular markets but up to you figure out how much.

SFRs are interesting, you will likely get a lot of competition for good ones. If the SFR is in good shape you'll fight against people looking for a primary home, they will not care about metrics and only a budget. You'll also likely go against some novice investors who have some cash to dump and just want something.... again probably not all that worried about numbers. These two groups will make it "harder" to get an offer accepted but not impossible.... The best advice is to know your range and go at it, but walk once it no longer works. Keep the timing short, the value of your offer over others won't be price, it'll be speed.

If the homes a rough and need work... you're up against flippers. If it's cheap to expect weekend warriors who watch HGTV to just go nuts on price as they think they'll do the work themselves and make a fortune (they won't).  You might also come across contractors/investors who will have the team/resources/expertise to go after the rehab cheaper than you... again messing up the price. 

Your best bet will be the retiring small-time landlord w/ only a few properties. Look for something w/ under market rents and is dated, but serviceable/rented. If your lucky the price will be based off the low rents and you'll increase value by just getting a better lease in play.... and bonus points if the landlord is just over it and your speed will be even more valuable. 

Multi-Family: Everyone and their mother either wants to house hack or become an investor. It's driving prices/demand up to insane levels on these. You're competing for w/ either people who have zero ideas about investing throwing crazy numbers or people w/ a ton of cash that need to park somewhere. 

The same logic applies as SFR, but look for something (through networking) off-market and a tired landlord w/ under market rents. If you can't then just toss out aggressive, yet reasonable offers but be prepared to do a lot of searching/research.

BRRRRRRRR: Everyone wants to do this even if they don't know the fancy name.... but it's hard and can be expensive. Materials in a lot of markets are up, good labor/contractors are all swamped and probably don't need the new work or won't take it. The terrible ones, they will post everywhere asking for more work and promise you the world but never come close to delivering. 

IF ... you go this route, networking and referrals will be your lifeline. Being out of state you need dependable people but also ones that you can trust to be your eyes and ears.... and honest.

You're also going to need a GOOD banker, not just some broker who is "investor-friendly". If they can't explain to you in detail about delayed financing (buy cash, pull out cash in 6mo or less) then they won't be a good fit. If they try to tell you it's a years worth of seasoning... they won't help you accomplish your goal find a new one.

Last but not least, don't ever go cheap. Cheap is a money drain that will come back to haunt you... instead, look for a good value. You're dealing with construction and people, neither of these behaves the same way a spreadsheet does. Understand your costs, understand the value of your time, and then apply this to whatever it is your doing.... and find something that fits your story or your goals.

 First, little google to see if this "lawyer" is actually a lawyer..... and currently licensed. Probably a good idea to cross-check the name w/ the phone number as well.... 

But I wouldn't call back, no point and just makes his life easier. Make them contact you through proper channels.... and then have your lawyer respond. If you're still curious from time to time in the future, just check WI casenet to see if anything ever pops up (doubt it). At best you're going to give them an answer/proof that this case isn't worth it..... at worst you say something you shouldn't and they go after you. Either way, you literally gain nothing....

I know you have the urge to defend yourself and your honor/integrity/make a point.... but as much as you want to do that not worth it. 

If the property is not up to his standards then the most likely cure would be ....let him break the lease at no cost. I think it'd be difficult to show damages past moving expenses if it's just a regular property and not something unique.

In regards to being sued, anyone can sue anyone for any reason....doesn't mean they will win or even can find a laywer to take the case. Plus if you showed property to best your abilities, I'd imagine he will have a VERY hard time proving otherwise...

Give me 5k and I'll find you something ready to go that at a minimum apprises for purchase price lol

 Not worth it, I say this as someone with a house that has a detached 2 garage with apartment.  It's all on one meter so utilities can't be split so it's not nearly as valuable as a rental as I thought it would be . 

Plus I just have more expenses to keep it up as well...with not a ton of added benefit.

the people looking for this type of arrangement often want to buy... Not rent.  The people renting often looking for a their own space not to cram more people into an a single home.

 In general, it's way different then the traditional 20-25% down. Takes a lot more cash as it's more risk and that's if you will even find a lender willing to let you borrow.

and once it's done you could have issues with market value if there's not enough comps..not to mention you're about a year out and at the mercy of the market.

get your funding lined up before you put to much effort into it...

Depending on your connections and market.... Good labor is hard to come by and either expensive or you have an existing relationship.

Funding is also more difficult to secure for new construction even more so for investments vs primary.

Dear (insert names on lease)

The lease for (insert property address) ending (insert end date) will not be renewed.

Please contact (insert landlord name) to schedule a pre move out inspection or final move inspection if you're waiving a pre inspection.

-

(Your name)

heres a glimpse into the future ....

you won't be happy with his work, you'll have seen far better work somewhere else and think it's not that hard and you've could of done it.

he won't complete the project, it'll be delay after delay after delay. It'll at best be half finished or work in progress or at worse turn into a much bigger problem.

you will get charged much more when someone else comes in to fix this. That contractor won't want to fix someone elses work and you'll pay for that if you can even get a good person to take the job..

and then finally you'll be unhappy with the new contractors because they charged too much and it wasn't that hard and you should find a cheaper bid next time.

All the while you'll have a nonpaying tenant promising you money next month, but next month will never come.

If you want to be nice, work with them on payments. Convert over to bi monthly or even weekly payment. Get it in writing and have deadlines don't roll over significant balances....

Also, if you REALLY wanted to be nice and it's truly bad luck.... Have them reach out to local churches. They will either have the resources or know where they are to help with rent...