All Forum Posts by: Stephen Lynch
Stephen Lynch has started 21 posts and replied 63 times.
Post: Long term mortgage or keep it in the HELOC
- Posts 65
- Votes 12
Okay so status update...I had the landscaping done and relisted with new professional photos & drone shots in addition to multiple price drops and - absolutely nothing. No tours at all and according to everything I can find the property is in better condition (new construction) and less per sq. foot than surrounding comps.
Any suggestions!?
https://www.zillow.com/homedetails/928-Siebert-St-Columbus-O...
Post: Long term mortgage or keep it in the HELOC
- Posts 65
- Votes 12
Quote from @Robert Ellis:
Quote from @Stephen Lynch:
Quote from @Robert Ellis:
Quote from @Stephen Lynch:
Quote from @Robert Ellis:
Quote from @Stephen Lynch:
Hello,
I'm seeking advice regarding a new construction property I built in Columbus, Ohio. As a background, I have a well-paying job and am not in immediate need of cash. I'm not taking significant risks with new projects at the moment either so I'm not in a huge rush but also don't want to lose money as time goes on.
I decided to build this property in an up-and-coming area (B- grade) with an estimated rental value of $1800-$2000 per month. The total investment is $300,000, funded by cash and a HELOC (current balance $156,000, monthly payment $1200).
My initial plan was to sell the property for $350,000, making a $20,000 profit after closing costs. However, due to unexpected construction costs and delays, the project is now at break-even. It's been on the market for a while with no solid offers.
I'm facing the decision of selling the property at break-even or potentially a loss, or renting it and waiting for a better market. I believe the property could reach my original target price if interest rates come down.
My question is whether it's better to rent the property and use the 10% HELOC as my "mortgage" or do a 7.5% cash-out refinance.
The HELOC has the advantage of no closing costs and potential cash flow if I don't pay down the equity. I could also pay down the HELOC over time for lower monthly payments as time goes on (and subsequentially increasing the cash flow but also the equity I have stuck in the property).
The downside is uncertainty about how long I'll need to wait for a better market, and the HELOC being tied up until I can sell or refinance. I might have better cash flow just by paying off the HELOC and putting the $150,000 principal in a 5% high-yield savings account which has me considering selling (even for a loss) just to move on.
Any advice would be greatly appreciated.
who the hell designed you a house and had you lose money on new construction. I'd love to look up the address and let's embarrass the realtor who can't sell it as well as the builder who didn't' build it or design it efficiently enough and who lost all your money. new construction in columbus is on fire and wherever this is built is not reflective of any person we have worked with in our market. can you shed some light on the deal?
Feel free to take a look at the property. 928 Siebert St, Columbus OH.
Let’s do a deep dive into this so you can avoid these kinds of people in the future. Mr. Koevenig with Cbus Remodeling is a full time health professional who started a side business in 2020 that is listed as mainly renovations. From his linkedin, he describes himself as:
“ In addition to my IT role, I am also a business owner and a finance student. I founded a construction company in 2020, specializing in single/ multi-family renovations and new construction. I grew revenue to over $1M in the first year without external capital or debt and maintained a growth rate of 20%. I managed three teams consisting of 3-4 employees each and led all their projects simultaneously, while overseeing accounting, marketing, and financial operations. I transitioned out of the daily management once operations became stable and diversified our revenue streams in areas such as rental income, property inspections, and maintenance. “
Mr. Koevenig does not have a general contractor license he has an HIC license and from the public data I could find on his company listed here:
https://www.buildzoom.com/contractor/cbus-remodeling-llc
His license may even be currently inactive. Mr. Koevenig does not have ground up construction experience and would not have been able to get financing if he was properly qualified. He would have had to list his general contractor license and ground up experience.
In addition to this, the actual permit holder of your license is JOSE E MIGUEL with BROHIO CONSTRUCTION. Mr. Miguel on his linkedin is based out of Bellbrook ohio which is a suburb of Dayton. His website says he does projects in Dayton and columbus. Mr. Miguel also has his company listed as founded in January of 2022 and based on his general contractor license, he has a newer license in the city of columbus. His website mostly mentions home remodeling and home roofing. He also has one star review on google.
Let’s talk about your permit. Your permit lists the construction value as $210,000 and at your square footage of 1750 or so that is pretty low. The average listed price per square foot in our market trending for new construction by larger tract home builders is $130-$140 per square foot. They are contracting at a lower price than home builders are listing on permits who build 100+ houses per year in our market and have 50 going or more at a time.
In addition to this, your permit is still open. They have not closed it or gotten a certificate of occupancy. I’d recommend pushing to get that or get the city involved to revoke their license, both of these firms. Let them know the issues that you brought up. They also listed your house as 2100 square feet it’s all over the place.
Who designed the home? When I look at the design it’s not very modern, it’s very plain. It’s a lower quality standard than most new construction homes. Everything from the window choice and wrapping to the flooring decision to the layouts and general roof pitch. It’s not characteristic of the types of homes that would sell quickly in this area.
In addition to this, your photos by your listing agent look like they were taken on an iPhone. Get with Brian at fairytale films get drone shots and professional photos and also get some virtual staging done or stage the property. Your agent has had a license since 2021 she should know better. The description is short as well.
She’s based out of Dayton ohio that’s where her brokerage is listed and I’ve never even heard of them. I’d recommend trying to get out of your listing agreement or have her step it up because she’s the reason you aren’t selling.
I’m building 3 houses in the same zip code and all of which I’m sure we will sell before they are completed. The sales process design process and construction process are all managed by us. I think what really went wrong here is the number of people you had to work with.
This is very disheartening to see and I’m happy to help you get these people in gear. It’s an embarrassment to new construction in our market. They really should understand what they caused you.
Regarding the open permit, we’re just finishing up a few items for the final inspections and occupancy cert. so no concerns there I just didn’t include that information here.
All in all - yeah it’s a mess now I’m just trying to find an exit. If I update my photos and listing description do you still see the sale price as reasonable or no?
that's great I just removed those comments it's nice to hear that they did that, I have no idea how you got the permit in the beginning with an HIC license? who pulled the permit for the other home improvement contractor? did they have you fill out a notarized affidavit that said you were self performing the work? any info on the architect or design of the building too?
I think removing the listing and getting with a better agent along with new photos and virtual staging will make a massive impact. you only have 59 days on market and the fact that it isn's sold is surprising. I think the marketing has a lot To do with it. are you getting showings? new construction is very strong right now. deliveries went up every year in central ohio. existing inventory saw a 30% or more drop in unit sales but new construction has grown every year in terms of deliveries and sales. you are selling below what most new construction homes are selling at and also existing homes are selling at. I just sold a 667 sq ft new build in newark for almost $300 per square foot. the home is too big and poorly designed and finishes are very low quality inside. I think the best you can do is add a few accent walls in the bedrooms and make it less neutral. we paint everything white in our new builds and very neutral as well as do higher end simple painted accent walls and trim walls to help make the house a little different. if you really want to sell I'd get a interior designer / stager and spend 5k with a way more experience agent who sells new builds. we are licensed if you can't find someone. the way I market is very different.
I can help you do some financial analysis for potential exits if you give me more info about your situation in a private message as well.
Let me send you a message directly.
Post: Long term mortgage or keep it in the HELOC
- Posts 65
- Votes 12
Quote from @Robert Ellis:
Quote from @Stephen Lynch:
Quote from @Robert Ellis:
Quote from @Stephen Lynch:
Hello,
I'm seeking advice regarding a new construction property I built in Columbus, Ohio. As a background, I have a well-paying job and am not in immediate need of cash. I'm not taking significant risks with new projects at the moment either so I'm not in a huge rush but also don't want to lose money as time goes on.
I decided to build this property in an up-and-coming area (B- grade) with an estimated rental value of $1800-$2000 per month. The total investment is $300,000, funded by cash and a HELOC (current balance $156,000, monthly payment $1200).
My initial plan was to sell the property for $350,000, making a $20,000 profit after closing costs. However, due to unexpected construction costs and delays, the project is now at break-even. It's been on the market for a while with no solid offers.
I'm facing the decision of selling the property at break-even or potentially a loss, or renting it and waiting for a better market. I believe the property could reach my original target price if interest rates come down.
My question is whether it's better to rent the property and use the 10% HELOC as my "mortgage" or do a 7.5% cash-out refinance.
The HELOC has the advantage of no closing costs and potential cash flow if I don't pay down the equity. I could also pay down the HELOC over time for lower monthly payments as time goes on (and subsequentially increasing the cash flow but also the equity I have stuck in the property).
The downside is uncertainty about how long I'll need to wait for a better market, and the HELOC being tied up until I can sell or refinance. I might have better cash flow just by paying off the HELOC and putting the $150,000 principal in a 5% high-yield savings account which has me considering selling (even for a loss) just to move on.
Any advice would be greatly appreciated.
who the hell designed you a house and had you lose money on new construction. I'd love to look up the address and let's embarrass the realtor who can't sell it as well as the builder who didn't' build it or design it efficiently enough and who lost all your money. new construction in columbus is on fire and wherever this is built is not reflective of any person we have worked with in our market. can you shed some light on the deal?
Feel free to take a look at the property. 928 Siebert St, Columbus OH.
Let’s do a deep dive into this so you can avoid these kinds of people in the future. Mr. Koevenig with Cbus Remodeling is a full time health professional who started a side business in 2020 that is listed as mainly renovations. From his linkedin, he describes himself as:
“ In addition to my IT role, I am also a business owner and a finance student. I founded a construction company in 2020, specializing in single/ multi-family renovations and new construction. I grew revenue to over $1M in the first year without external capital or debt and maintained a growth rate of 20%. I managed three teams consisting of 3-4 employees each and led all their projects simultaneously, while overseeing accounting, marketing, and financial operations. I transitioned out of the daily management once operations became stable and diversified our revenue streams in areas such as rental income, property inspections, and maintenance. “
Mr. Koevenig does not have a general contractor license he has an HIC license and from the public data I could find on his company listed here:
https://www.buildzoom.com/contractor/cbus-remodeling-llc
His license may even be currently inactive. Mr. Koevenig does not have ground up construction experience and would not have been able to get financing if he was properly qualified. He would have had to list his general contractor license and ground up experience.
In addition to this, the actual permit holder of your license is JOSE E MIGUEL with BROHIO CONSTRUCTION. Mr. Miguel on his linkedin is based out of Bellbrook ohio which is a suburb of Dayton. His website says he does projects in Dayton and columbus. Mr. Miguel also has his company listed as founded in January of 2022 and based on his general contractor license, he has a newer license in the city of columbus. His website mostly mentions home remodeling and home roofing. He also has one star review on google.
Let’s talk about your permit. Your permit lists the construction value as $210,000 and at your square footage of 1750 or so that is pretty low. The average listed price per square foot in our market trending for new construction by larger tract home builders is $130-$140 per square foot. They are contracting at a lower price than home builders are listing on permits who build 100+ houses per year in our market and have 50 going or more at a time.
In addition to this, your permit is still open. They have not closed it or gotten a certificate of occupancy. I’d recommend pushing to get that or get the city involved to revoke their license, both of these firms. Let them know the issues that you brought up. They also listed your house as 2100 square feet it’s all over the place.
Who designed the home? When I look at the design it’s not very modern, it’s very plain. It’s a lower quality standard than most new construction homes. Everything from the window choice and wrapping to the flooring decision to the layouts and general roof pitch. It’s not characteristic of the types of homes that would sell quickly in this area.
In addition to this, your photos by your listing agent look like they were taken on an iPhone. Get with Brian at fairytale films get drone shots and professional photos and also get some virtual staging done or stage the property. Your agent has had a license since 2021 she should know better. The description is short as well.
She’s based out of Dayton ohio that’s where her brokerage is listed and I’ve never even heard of them. I’d recommend trying to get out of your listing agreement or have her step it up because she’s the reason you aren’t selling.
I’m building 3 houses in the same zip code and all of which I’m sure we will sell before they are completed. The sales process design process and construction process are all managed by us. I think what really went wrong here is the number of people you had to work with.
This is very disheartening to see and I’m happy to help you get these people in gear. It’s an embarrassment to new construction in our market. They really should understand what they caused you.
Regarding the open permit, we’re just finishing up a few items for the final inspections and occupancy cert. so no concerns there I just didn’t include that information here.
All in all - yeah it’s a mess now I’m just trying to find an exit. If I update my photos and listing description do you still see the sale price as reasonable or no?
Post: Long term mortgage or keep it in the HELOC
- Posts 65
- Votes 12
Quote from @Robert Ellis:
Quote from @Stephen Lynch:
Hello,
I'm seeking advice regarding a new construction property I built in Columbus, Ohio. As a background, I have a well-paying job and am not in immediate need of cash. I'm not taking significant risks with new projects at the moment either so I'm not in a huge rush but also don't want to lose money as time goes on.
I decided to build this property in an up-and-coming area (B- grade) with an estimated rental value of $1800-$2000 per month. The total investment is $300,000, funded by cash and a HELOC (current balance $156,000, monthly payment $1200).
My initial plan was to sell the property for $350,000, making a $20,000 profit after closing costs. However, due to unexpected construction costs and delays, the project is now at break-even. It's been on the market for a while with no solid offers.
I'm facing the decision of selling the property at break-even or potentially a loss, or renting it and waiting for a better market. I believe the property could reach my original target price if interest rates come down.
My question is whether it's better to rent the property and use the 10% HELOC as my "mortgage" or do a 7.5% cash-out refinance.
The HELOC has the advantage of no closing costs and potential cash flow if I don't pay down the equity. I could also pay down the HELOC over time for lower monthly payments as time goes on (and subsequentially increasing the cash flow but also the equity I have stuck in the property).
The downside is uncertainty about how long I'll need to wait for a better market, and the HELOC being tied up until I can sell or refinance. I might have better cash flow just by paying off the HELOC and putting the $150,000 principal in a 5% high-yield savings account which has me considering selling (even for a loss) just to move on.
Any advice would be greatly appreciated.
who the hell designed you a house and had you lose money on new construction. I'd love to look up the address and let's embarrass the realtor who can't sell it as well as the builder who didn't' build it or design it efficiently enough and who lost all your money. new construction in columbus is on fire and wherever this is built is not reflective of any person we have worked with in our market. can you shed some light on the deal?
Feel free to take a look at the property. 928 Siebert St, Columbus OH.
Post: Long term mortgage or keep it in the HELOC
- Posts 65
- Votes 12
Quote from @Ko Kashiwagi:
Hi Stephen,
How opposed are you to keeping it as a rental? If you have positive cash flow with the HELOC, you can wait and collect cash flow until it sells or sell at a loss and move on.
I’m actually pretty shocked nobody has even given me a low ball offer on the house at this point.
Post: Long term mortgage or keep it in the HELOC
- Posts 65
- Votes 12
Okay so am I hearing both of you correctly that it would be best to simply sell even for a loss vs. holding it and renting it? Alternatively, I could liquidate stocks to pay off the property but I'd be subject to capital gain taxes and obviously not leveraging. If the property was $300k to build all in and I can rent it and clear $1800 +/- that's about 7% CoC return not accounting for appreciation of the property.
Post: Long term mortgage or keep it in the HELOC
- Posts 65
- Votes 12
Hello,
I'm seeking advice regarding a new construction property I built in Columbus, Ohio. As a background, I have a well-paying job and am not in immediate need of cash. I'm not taking significant risks with new projects at the moment either so I'm not in a huge rush but also don't want to lose money as time goes on.
I decided to build this property in an up-and-coming area (B- grade) with an estimated rental value of $1800-$2000 per month. The total investment is $300,000, funded by cash and a HELOC (current balance $156,000, monthly payment $1200).
My initial plan was to sell the property for $350,000, making a $20,000 profit after closing costs. However, due to unexpected construction costs and delays, the project is now at break-even. It's been on the market for a while with no solid offers.
I'm facing the decision of selling the property at break-even or potentially a loss, or renting it and waiting for a better market. I believe the property could reach my original target price if interest rates come down.
My question is whether it's better to rent the property and use the 10% HELOC as my "mortgage" or do a 7.5% cash-out refinance.
The HELOC has the advantage of no closing costs and potential cash flow if I don't pay down the equity. I could also pay down the HELOC over time for lower monthly payments as time goes on (and subsequentially increasing the cash flow but also the equity I have stuck in the property).
The downside is uncertainty about how long I'll need to wait for a better market, and the HELOC being tied up until I can sell or refinance. I might have better cash flow just by paying off the HELOC and putting the $150,000 principal in a 5% high-yield savings account which has me considering selling (even for a loss) just to move on.
Any advice would be greatly appreciated.
Post: PM or self manage automation tools
- Posts 65
- Votes 12
HI all,
I self manage my small portfolio near my home and that's been great - especially if you get good tenants. However, for out-of-state I've been fairly unimpressed with the PMs and it's been more work than just self managing - at least it feels like that.
Does anyone self manage out of state (or even locally)? If so, What kind of automation tools do you have setup (Google Phone #, ticketing system, on-demand virtual assistant etc.)? I'm considering just paying for placement services out of state (tours, sign a lease, handover for self management).
Thanks,
SL
Post: Separating personal & business
- Posts 65
- Votes 12
Hello,
Like many of you, I started without an LLC and purchased properties via conventional loans and protected myself with Umbrella Insurance. However, I'm getting to the point where the business is scaling and I created the LLC.
Currently, I have a rental checking account for in/out rent/mortgage, reserves, security deposits, repairs etc. I take part of my profits and pay for my own home and it leaves me with the repair money at the end of each money that I continue to accumulate.
Ideally, I'd prefer to take ALL rental properties including ones under my name and have transactions flow through the LLC checking account along with any new real estate purchases and then pay myself in profit to pay for my personal mortgage (via a simple internal bank transfer each month).
Does this setup create a situation where someone could go for those personal properties if they went after the LLC since I'm using the LLC to pay for those properties? Do you guys separate personally owned properties/expenses with your LLC business / expenses?
Thanks,
SL
Hi all,
I'm working on my first BRRRR in Ohio and it has a detached garage roof (flat). Every roofer has recommended changing out the wood with new OSB, but they are all offering different options for the roofing material.
Options...
Reinforced EPDM .60mil with no fiber board
EPDM .45mil with fiber board
Flintlastic SPS
I'm convinced EPDM is the way to go, but I'm not sure what the best practice is regarding the use of fiber board under the rubber? The garage is detached and is for storage only so it doesn't need insulation. I'm reading that fiber board is used for insulation between the rubber and the OSB, but I've also read it can help to avoid tears from falling tree limbs and such.
If the cost was the same would you go with .60mil EPDM w/o fiberboard or .45mil EPDM w/ fiberboard ?