All Forum Posts by: Mike Wilkinson

Hi guys, I have a unit or two that needs turning out in Cincinnati and my usual guys are busy. Pretty basic, handyman-style work. I could also use a drywall guy. Please let me know if you have any references that may be useful, thanks in advance!

@Payton Reid As others have mentioned, I think that your answer lies in your goals and which market you are investing in. If you would like to build a significant passive income without much work, I would suggest buying cash and being your own bank. Allow the income from the purchased properties to build up and use it to buy more debt-free.

I think a point that many are missing here is that it's a pain in the butt to own a bunch of rentals! I'd much rather have 10 strong units paid off than 60 leveraged. With your cash position, the properties that you buy could already be paying for 1+ paid-off property per year themselves and you could continue spending your time on whatever it is that's making you all that money!

Best of luck!

@Duke Giordano quite surprising but I am finding help elsewhere! Thanks for your interest

I am helping a client dig into this type of transaction and I'd love to speak with someone who has been down this road before. If you have, please reach out!

@Tim Davids I went all out on staging this one. I paid my stager 1% of the purchase price to stage the whole house ($5,000+) and it was worth every cent! This means furniture in every room and part of the house, back patio furniture, the whole 9 yards. This is a emotional experience for buyers and I think that this level of staging really helps people view the home as being luxurious and allows them to picture it as a cozy place to call home. In a hot market like ours here, I believe it's worth every cent and quite frankly I think it's the safer way to go. 

@Diane Tycangco Seasonality is huge in our market here, and you could very well be saving yourself tens of thousands buying between September and January, especially with move-in ready type of homes. I had a listing go up in Aurora on Thursday morning and in 24 hours I had 40 showing requests and 5 offers already.

For me, $100 / month would not be significant enough in this situation. Do you live here in Denver? With the appreciation we see here I am a large proponent of the live-in flip or turning your primary into a rental. These strategies allow you to take advantage of the owner occ financing options and avoid capital gains taxes while allowing the appreciation we have been seeing go to work. 

Thank you @Adam Lacey! This was up in Lafayette. It's a very hot market up there with people who work in Boulder and aren't able to afford a million dollar home. 

Thank you @William Keasling! We certainly went for some higher end finishes where it counted, but nothing too crazy or custom. Our theme ended up matching that of our stager very well which I think was important. We had offers coming in within 24 hours!

@Jay Hinrichs thank you Jay! I'm probably not looking to get a business started in doing them full time right now, but I could see that as a possibility if the market were to turn in the future and deals became easier to find. We have a VERY competitive, investor flooded market in Denver right now.. a positive to a downturn in the economy would likely be a thinning of many investors and agents in our market. 

So for now I'll likely just be knocking out 1 or 2 a year to help supplement my income and fast-track the passive income! Do you have a flipping business? 

Below are my numbers and a link to my budget sheet on the DIY flip that I just sold here in Denver, I hope this is helpful! The project took me 5 months, and I acted as the GC, agent, and drywall enthusiast. I hired subs for the roofing, egress window, plumbing, electrical, carpeting, cabinets, countertops, and exterior painting. We did the rest of the work ourselves (myself and a friend with remodel experience). I found the deal by taking my clients to see the property, realizing that it was mis-listed (there were 2 bathrooms rather than one), and that there was serious seller motivation (nasty divorce). After a few price reductions, it was listed at 390 when we saw it, and I negotiated down to 340. 

Some of the big lessons that I took from this project:

1. "Luck is when preparation meets opportunity" - I have read 60+ books and listened to almost every episode of the BP podcast over the past couple years; I felt knowledgable and prepared enough to negotiate and tackle this project. 

2. Seasonality / market timing is crucial (especially in our market). I bought during the holidays and listed in May. 

3. Low supply, high demand area is very important. 

4. Staging is very important. 

Numbers:

Purchase price: $340,000

Financing costs: $18,000

Buyer agent cost: $14,300

Rehab costs: $56,000

Total costs: $428,000

Sale price: $511,000 (16k over asking)

Profit: $83,000

Link to budget sheet: https://docs.google.com/spreadsheets/d/1wIg3oWKBHC...

Please reach out with questions or if you would like to connect! Happy investing!