All Forum Posts by: Steve Wilcox

You hit the nail on the head in my opinion. It takes more work but there is a higher yield then in other areas assuming you are in an area where you can actually get decent tenants.

I also agree that some screening and delivering a good quality product and having the ability to be patient to get a tenant in the door go a long way.

just realized I was late to the thread-

House looks great

70-40=30k profit =75% ROI

110-(40+15)=55k profit = 100% ROI

160-(40+40)=80k profit = 100% ROI

Based on lower workload for wholetail this makes the most sense as you will be in and out fastest. However this also depends on your personal deal flow, and how much time you spend at your rehabs.

If you have lots of other deals in your pipeline and will need the cash then wholetail or wholesale and make your profits and move on.

If you have nothing else coming you might go all in and do a full rehab and maximize profits.

I do not deal in warzones, but I do invest in tough areas. If you can not safely go to a property good tenants won't want to either.

Where I live the hood is the only place where you can buy cheap enough and has low enough taxs to make it worth the risk of holding a rental. A duplex in the ghetto still has ARV of 180 and taxs of 5K. Rent on a 3 bed is $1200-1300 so total gross on a duplex is about $2500

We pay high management fees, deal with turnover, and make repairs when they turn. Just expect it. These properties are also harder to finance, so keep that in mind as well

The hood is also an aquired taste for lots of people, you have to be guided by your own comfort level.

If you have questions please ask them on the forum so that everyone can try to learn from the answers and have an opportunity to chime in.

@Account Closed Sounds like your agent doing a favor smelled an opportunity to make a little extra cash and is trying to squeeze himself the commission since its now on the table.

There is nothing you can do if the seller wants to enlist an agent before your contract was accepted and if they want to counter at a higher price that is also their prerogative.

However you should be upfront with 'your agent', and tell him what you think is going on. If he did bring you the deal and the seller is going to pay out a 6% commission then why not let your guy get his 3% on your buy side of the transaction? Remember however he works for you, and if he is not satisfying you for some reason then you do have the right to get rid of him if you have not singed anything (this is only a question of relationship management, and personal ethics)

You need to speak with your partner- if he is an experienced investor you and he need to navigate this together.

All cash offers need to be accompanied by proof of funds, otherwise it is more than likely you dont have the cash which makes you a much higher risk than a real cash buyer. As @Robert Williams said the sellers agent is just doing his job requesting proof of funds to protect his client from buyers who might flake or not be able to actually close. If you plan on using hard money or an outside investors capital either one should be able to provide specific approval or POF with LOI which will satisfy the seller.

As to the realtor if he provided you with advice, and/or brought you to the deal then you have entered into agency relationship.

How much is the cost of the house and how much commission are you talking about? If the agent originally wanted to do you a favor, now wants a commission on the buy side, and is telling you your partner agreed to something and your partner tells you something else there is a break in communication and you need to bring all parties together to find a resolution

If the paper is really stuck on removing it will pull out big chunks of drywall or plaster.

You can encapsulate with a skim coat of mud but this requires some plaster/ compound skill to get a smooth finish.

Removal is a pain, but is just grunt work. We use diff gel thinned with very hot water and spray it on with 3 gal sprayer until the paper is saturated, then skim coat or just patch as needed.

I dont like tiger paws unless the chemical doesnt melt the glue on the walls.

There are primers that can paint over and supposedly seal the paper but never worked with one

Also HUGE warning/ red flag- when a guy is super cheap be very careful. DO NOT give a lump sum down payment on the total job. Pay for performance, break the job up into smaller pieces and get a payment plan that you can both agree upon and is fair.

Pex instead of copper

Also often times you can put up lighting around the exterior of the property and spot light the front of the property. This works great for curb appeal and makes it harder for people to sneak around your property.

Properly securing the property in the first place. Seal off all windows and doors, at the very least install plywood over openings.

Usually people stealing copper are looking for easy easy easy, so if you make them work to get it they will move on.

Sorry some more info I forgot-

Property already has separate meters, separate panels, and is on breakers.

This property is in a c- or d+ area but a c neighborhood.

I have not gotten formal quotes for the work yet, but I normally pay about 6-8k for total rewire, but my electrician is a destructor. I am assuming I will be able to do the 2nd floor for about 5k, and the third for another 1.5k or so if I tack it on the original job. Problem is I now need to patch and paint

I would like to lay out a scenerio for a property that I am closing on in the next few weeks (hopefully, we have a final approval for SS) and hear what other buy and hold investors have to say.

Backstory- My normal bread and butter property in this area is badly distressed, total rehab (all mechanicals and cosmetics). The property in question is a very light if any rehab. The knob and tube all appears to be in great shape in the basement.

The property is a legal duplex, with a 3rd unit in attic with 2 egress exits. I will not be renting it illegally- the area has 3 units and it is likely I could change property from legal 2 to legal 3 fam, but that will be decided based on tax consequence compared to potential rent from 3rd unit. Other problem is the 3rd floor has electric baseboard heating which may not mater if I decide to seal it up.

The 2 units are both in very clean shape, totally turn key, however the home is wired with knob and tube which would normally be totally removed. However the first floor is rented with a long term tenant who has invested in decent appliances and furniture so probably will want to stay for foreseeable future- but they are about 20% under market rate for rent, and are month to month.

So-

Do I:

1. terminate the tenants lease rewire the whole building top to bottom?

2. rewire the second floor (and maybe 3rd if I am going to use it or for potential future use)

3. Keep the knob and tube in the building