All Forum Posts by: Paul Hitchings

Probably the same issues as with any other city...

Turnkey is another word for "all the sweat equity is gone". Turnkey is what hands off investors buy, not guys (or gals) who can do flooring.

FHA203K is a dream on paper and a headache in real life. It is useful, but will make you crazy IF you can get it to close.

Your time each weekend is best spent fixing up a multi-family apartment! There is NOTHING online that is more valuable that improving the value of your own investment ;)

It seldom makes sense to connect with a wholesaler, they don't really have secret inventories and what they do have has already been filtered through several other wholesalers, like  "these properties didn't sell last time around but how about we give you 10 at once?" 

If you want a super secret deal, you need to find it from non MLS sources, i.e. direct to owner, tax sale, auction, court house step trustee sale, etc. Doesn't necessarily mean you will get a better deal than working directly with a Realtor or listing agent.

"What areas would you suggest"  Different investors have different comfort levels.  Ceteris paribus, I would buy the most beat up multi-family in the nicest possible area, presuming it doesn't need major structural work.

I would drive around parts of Chicago looking for areas you would invest in (and can afford) and find a few multi-family buildings that don't look like they are getting the attention they deserve, contact owners directly. Send about 20-30 letters a month and you will get a call or two eventually. Not the most efficient way to get a deal, but you might find something before it hits the market or better yet, put the idea of sale into an owner's head who wouldn't have otherwise considered it.

Good luck player!

First question, are you the only one going to own this business? If your sole purpose for creating the business is legal protection, that should help simplify "what is right for me" answer.

Are you going to meet with an attorney on this?

 Alex, have you considered working with a realtor? The listing agent is charging their client X percent regardless if they keep all of it or not.

Will I make $480K in mistakes and can I sell my home for as much as  Realtor could?"

Good question. 

Quick example (not implying you're a hoarder) - FSBO has $2M home that is beautiful, refuses to move out of property to list it. Has 2 large dogs that must be crated in garage when buyers come to see home. Because of this, home gets only 6 offers instead of 10, because buyers don't like the home with all the junk in it (and owner has a TON of junk) buyers can't visualize themselves in the new home and thus, less offers are received and home sells for 1.9M instead of $2M. So, even though home was in a nice area, without a Realtor to tell the seller "MOVE ALL YOUR CRAP INTO STORAGE!" the owner did themselves a disservice because they wanted to save 6%. Now in this case, 6% is $120K so technically, owner did save $20K. BUT, what if owner received 3 offers instead of 10, and home sold for $1.8M instead of $2M, now owner is receiving $80K less than if they sold for $2M with 6% realtor commission.

Sellers don't always know when things are costing them money in the final sales price because most sellers are not experienced real estate professionals. 

If you want to save money, consider trying to work with a Realtor who might negotiate their fees down (though some high quality Realtors will NEVER negotiate fees down).

If you truly want to do everything yourself, consider what everything is and if you have time/energy and EXPERTISE to do so. 

Either way, good luck!

If you want to make the illegal unit legal, I suppose it would take permitted work completed by a licensed contractor? 

You could try calling/visiting local inspector's office and see if they have records in the property. I would also look up local county code so you have a reference for what the city people tell you.

Then get contractor's quote for repairs, factor that in to your rehab, and see if the numbers work out.

What I don't get is why the 1bd illegal, does it open into another unit instead of the exterior of the building or? 

my 2c

1) Parts of the flipping process you are not as familiar with 

2) Tips for sourcing leads

3) Thoughts on interacting with homeowners

4) Overcoming growing pains and building a team

Like they say, people do business with those they "know, love and trust."  So if you're a likable, honest and intrepid business person, I don't think you need to worry about anything other than being yourself.

As an aside, I once had a mentor who was quite advanced in his investment methods. The only thing that ultimately ended our relationship was that I struggled to have faith in his methods, which were successful when applied, but required large amounts of faith and very modest initial investments.

So, I suppose the only thing that might make this flipper friend not want to associate with you is if you take everything you learn from him and do nothing (or very little) with it.

I'm sorry Frank! I haven't given up!

I'm embarrassed I forgot to mention the local newspaper(s).  

google "Realtor Fairhope AL" and call every broker on the first page. Then schedule listing presentations with the most successful agents from each brokerage (ask the brokers).  Then..

1. Choose a realtor
2. Clean your house (really)
3. Put EVERYTHING in storage except 1 bedroom
4. Put home on market
5. Take first reasonable offer

Have fun!

There is only one partner I trust in this world and I see him when I look in the mirror every day...