All Forum Posts by: Owen Dashner

Investment Info:

Single-family residence wholesale investment in Omaha.

Purchase price: $129,000
Cash invested: $450
Sale price: $153,000

Contributors:
Brandon Tauber

This was an off-market deal from a direct mail letter just off of 50th and Leavenworth in Omaha. The house was in a sought-after redeveloping area in midtown, and the owners needed a quick sale with some extra time after closing to get things moved to their new house. This house needed quite a bit of work, so we got a pretty sweet deal on it. We decided to sell it to another investor who was looking for a rehab project instead of rehabbing it ourselves over 3 months during the winter.

What made you interested in investing in this type of deal?

Off-market single family homes needing work in good areas are our favorite deals.

How did you find this deal and how did you negotiate it?

We got a call from one of our direct mail letters. The owners were pretty negotiable on price in exchange for us making it a really easy transaction for them, with post-closing possession. They left a lot of things behind that we ended up cleaning out.

How did you finance this deal?

Line of credit

How did you add value to the deal?

All we did was a cleanout of all the stuff left behind, which was quite a bit. It ended up costing $450 for the cleanout.

What was the outcome?

We sold the house directly to another local investor who we had been talking with. He was excited for a good rehab project with some room for profit. We were able to sell it quickly and profit about $21K after soft costs.

We got the deal bought and sold within 1 month, which meant a nice little Christmas bonus for Red Ladder.

Lessons learned? Challenges?

We debated quite a bit about doing the work to the property and selling it as a retail flip, as the ARV supported around $230-240K. But with 3 full floors of the house plus the basement needing work, we decided to punt and make a quick $20K profit instead of a slow $35-40K with a lot more risk and time.

Lines of credit are best, since you are only paying interest during the time you have the money out.  Private money is also an option, provided the terms are flexible for your situation.  Hard money is also a good short term option for non-owner occupied properties.

Thanks Matthew and Elizabeth.  I should be more specific, I suppose.  I am looking to potentially put together and invite high level local investors to a mastermind group to share ideas on business/investing/personal and professional growth/mindset/scaling.  Not just a local meetup, but one with experienced players only.  

For any investors who have either started or are part of a really good mastermind group, I'd love some input on how it is structured. What is the format, how many people are part of it, paid/free, venues, is it speaker led or open format, etc. Any input is appreciated. Ideally what I am going for is not only REI tactical/strategy stuff, but mindset/goal setting/accountability/etc. What do you like about yours, what do you not like?

Thanks in advance!

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Omaha.

Purchase price: $186,000
Cash invested: $1,000

Contributors:
Collin Schwartz, Chris Pomerleau, Brandon Tauber

This is a 4 plex that we bought off of the MLS in Omaha for $100,000 below appraised value. Two of the units are townhome style 2/2's, the other two units are 1/1. Rents are $750, $750, $550, and $550, separately metered water and electric, plus there is a detached 5 car garage for extra income and coin laundry onsite. This was a smoking deal that we bought for cash and did a full appraisal BRRRR on 1 month later, recovering 100% of our cash, with an appraised value of $289,000.

What made you interested in investing in this type of deal?

This was a WAY underpriced 4 plex that hit the MLS just off of Leavenworth and 30th in Omaha. It was owned by a non-profit, and the list price was $150,000. It is a conversion, but the setup is exactly like a built for purpose 4 plex. Great layouts on the units, the units were in good shape, with minor cosmetics only needed. There is room to raise rents as well. The 5 car garage in this part of town is the cherry on top.

How did you find this deal and how did you negotiate it?

I noticed it when it hit the MLS with my saved search. I called my biz partner whose office is almost next door to the property. We called the listing agent and scheduled a showing. There were a million people calling about it. We took the time to build good rapport with the agent and she liked us. We ended up beating out much higher offers by closing quickly with cash, as-is.

How did you finance this deal?

We paid cash for it.

How did you add value to the deal?

The units were fully rented already, so we have not yet had to do much to the property. A couple units could use new flooring and paint upon moveouts.

What was the outcome?

We refinanced the property a month later with Dundee Bank to completed the BRRRR. It appraised for $289K, which was $103K over what we purchased it for. We pulled all of our cash back out, left $100K equity in it, and are now owners of a solid asset with nice cashflow and room for improvement.

Lessons learned? Challenges?

There are still deals on the MLS! This deal was out there for the world to see, so I guess the lesson here is, be prepared to act fast when opportunity knocks. Also, be nice to people. The listing agent told us where we needed to be to get the deal done because she liked us. Her phone was blowing up with showing requests and offers from rude people. The sellers wanted a buyer with minimal baggage and who would take care of the current residents and do a good job managing it.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Dundee Bank was great to work with, highly recommend!

Investment Info:

Single-family residence buy & hold investment in Omaha.

Purchase price: $120,000
Cash invested: $75,000

Contributors:
Brandon Tauber

This is a super cool brick Tudor we bought close to the Med Center area just south of Leavenworth in Omaha. It was really dated with an old bathroom and kitchen, it also had a huge dormer upstairs that was pretty janky. We think the surrounding UNMC area is going to blow up even more than it already is with all of the new developments and added staff, so we decided to deck this house out and BRRRR to keep it as a long term rental for Doctors and medical staff.

What made you interested in investing in this type of deal?

Brick houses, especially Tudors, are one of my fav types of construction. The fact that we were able to buy for such a great price gave us options for exit strategies. The Med Center is a target spot for us right now with all of the new green lit construction and jobs being added, so we decided to keep it.

How did you find this deal and how did you negotiate it?

We actually paid more than the seller was asking for it, because it was worth it, and he did not know what he had. We felt it was the right thing to do.

How did you finance this deal?

We bought using our line of credit.

How did you add value to the deal?

We put in a new garage door, window trim, entry door and windows. We gutted the kitchen and main bath, and added a full master suite with a sweet en suite to the dormer (lots of sweet suites!). We also replaced the furnace, refinished hardwoods and painted throughout.

What was the outcome?

The property appraised at $250,000. We pulled out $212,500 (85%) which was more than our investment at 4.5%. It rented for $2,350. No money in the deal, 400 bucks (ish) cashflow even after PM fees.

Lessons learned? Challenges?

This project took longer than anticipated, blew the budget by $15K, and rented for slightly less than anticipated. But, we were OK with all of those things since the numbers still make sense and 30 years from now it will still be a killer asset.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Stephen Ward with Exceptional Properties Group for the project management on the construction and the PM work. American Interstate Bank for the long term financing.

Hard money is also an option - refi out or sell when the project is done.

Welcome to BP! With that much driving, you should be able to pound out a bunch of podcasts in no time!  The Biggerpockets podcasts are great, there a ton of others out there as well to help you learn. 

Good luck!

As Jay said above, not all title companies will handle wholesale assignment transactions.  In Omaha, there are 2 main title companies that will, a lot of others will not. The wholesaler may just know that his/her title company is experienced in handling the type of transaction you are doing. 

Why not just ask the wholesaler why they prefer using that particular title company?  I know I always try to do business at a couple different title companies because I like them, they give me a discount, and they bend over backwards for me because I give them a lot of business.  Maybe your wholesaler is the same way?

Jody, a friend of mine is an appraiser, shoot me a message, I can forward you her number.

402-578-4003