All Forum Posts by: Account Closed

@Rich Weese great post!

@Emilio Ramirez That's a great list for people to begin with and modify as they do their own projects. I'm guessing your in a colder region than we have here in Virginia.

To all, other than traditional bank financing for our spec units, what options should we look into? Does anyone have any referral's? We build 2-3 homes a year and clients pay cash (yes, insane) or already have qualified for construction to perm financing. I'm aware of subordinating the owners land to the bank and buy downs. We are a very HOT market and I have several single lots and developments being offered all the time but, my hurdle to spec home building always is (and probably will always be) finacing.

Welcome to BP @Stacey Williams

You may want to locate and attend some local REI meetings. Get out there and learn who the players are in your area and start talking with them. Let them know how you are structuring your deals and ask them what their opinion of your deal is. Also, remember that people are usually more willing to do business with people they know.

Good Luck!

I think the answer is multifaceted and mostly comes down to "it depends". For example, it can be market dependent. There is a broad range of renters in the DC metro area. The Suburb renter typically commands lower rents than the young hipster of a trendy DC neighborhood. You will find that competition for high end rentals in DC is greater than in the "burbs". I just had lunch today with some associates and the conversation touched on how someone's buddy had recently moved into a great rental. His 2/1 rental had granite, wood floors, oversize tile and stainless steel appliances. These rentals move faster, have higher rents and the renter stays longer while taking care of the unit. In the burbs these amenities are desirable but you won't see as much return on those investments.

Another factor is procurement cost, frequently I see stainless steel on clearance that are nearly identical in costs to a comparable black unit. If you're in your local box store enough you'll be able to find stainless steel on sale in their dent and ding section as well. Frequently there is a small inclusion on the back or side that doesn't effect performance and won't be visible once installed.

So I guess it really depends on the situation. Consider certain market conditions, location and procurement costs then make your decision.

Good luck!

It sounds as if the "nick" was accidental. If you've used this handyman before then you must think he has some value to you. I would give him the option to repair the problem. Many of my subs can't take a monetary hit but have no problem giving up some human capital in these situations. If your handyman is willing to do the repair then maybe offer to pay for the materials. Business is all about creating a win-win for the parties involved. Good luck!

@Ryan Harris

Welcome to BP. You're going to find most everything you need to know on this site by participating in the forums. There's also a large volume of knowledge to be gained by listening to the podcast. Congrats and good luck!

@Brandon Turner

@Ned Carey

Sound advice. I get so risk adverse sometimes and in the DC market things fluctuate so rapidly I tend to bog myself down with numbers. The upside is that my rehabs always produce profits!

Recently I had sent an Investment Proposal for an off market property to a local HML. The Lender expressed interest and thought the investment fit one of his programs. Everything seemed to be going as normal until after I presented the Lender with the Investment Proposal. My numbers were good and there was approximately $80K in net profits. Well, I never heard back from this Lender (strange) and now the property has been contracted by another rehabber. Needless to say, I had that funny feeling and have not made any subsequent Investment Proposals with that person. I know there could be simple explanations and I'm not asking for a list of those. My question is this, If I present a lender an Investment Proposal how do I know that the lender will operate ethically with my opportunity and not show it to other investors? Should I send a NDA before the proposal? Would the lender even sign it??

Bill,

The low price and owner financing is probably teasing you to consider it. However, if it were my opportunity the fact that its a declining market, there's family living for free, then drop their price ~30% and consider owner financing is warning enough for several reasons already stated by others.

BUT, If you have some other play that includes possible use by non-profits, govt agencies etc then maybe; if the numbers work.

Good luck and give us updates.

Good stuff Jim.

After reading the response I'm still lost as to what format to use as an opt-out letter. Looks to me like we all somehow have opt-in to our information being shared. I understand if it was to obtain financing, disseminate to clerks office etc but I don't want to be the receiver of junk mail (like @Bill Gulley states) or worse.

I have 2 deals lined up. Both are SF row homes in a very nice neighborhood of DC.

Deal one:

1. $350K purchase
2. $92K rehab (conservative)
3. $580K ARV (comps are $632K)

Deal two:

1. $350K purchase
2. $92K rehab (conservative)
3. $580K ARV (comps are $600K)

Currently seeking equity partner (with experience) for 50/50 split. Not interested in any HM offers at this time. I have plenty of "experience" and local HML's if I need to go that route.

PM me for more info. Thanks.