All Forum Posts by: Thomas Magill

Brandon Despras, I kept the property vacant prior to the sale. The reno took about 3.5 months. 

Carlos Paz, thank you, I appreciate it!

I currently use Buildium to manage my rental properties and I would like to see what else is out there.  Please let me know what you use and your experience with it. 

Investment Info:

Single-family residence fix & flip investment in Concord.

Purchase price: $116,000
Cash invested: $95,000
Sale price: $299,990

This was one of the toughest projects I've done so far, but one of the most rewarding. I had to take over the project from the original contractor due to lack of time and effort spent on the project.

I added a master suite by filling in a one car garage, built out the walkout basement, and opened up the floorplan. All of the major items were renovated ie mechanical, electrical, plumbing. And, a full renovation of kitchen and bathrooms.

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

During the summer of last year a lot of deals fell out of contract due to the pandemic. This property was one of those properties.

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

This deal was brought to me through a wholesaler, but they did not put a fee on the deal because they just wanted to get rid of it.

How did you finance this deal?

This deal was financed through private money.

How did you add value to the deal?

This biggest value add component came from filling in the carport with a master suite. In addition, the rest of the home was renovated top to bottom.

What was the outcome?

The property is under contract for sale and I'm just waiting for it to close.

Lessons learned? Challenges?

The biggest lesson learned was to never give a contractor two jobs at once, if it is the first time working with them.

Investment Info:

Single-family residence fix & flip investment in Concord.

Purchase price: $116,000
Cash invested: $95,000
Sale price: $299,990

This was one of the toughest projects I've done so far, but one of the most rewarding. I had to take over the project from the original contractor due to lack of time and effort spent on the project.

I added a master suite by filling in a one car garage, built out the walkout basement, and opened up the floorplan. All of the major items were renovated ie mechanical, electrical, plumbing. And, a full renovation of kitchen and bathrooms.

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

I was focusing on flips at 150k and wanted to scratch my design itch a little bit more

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

I found this deal through a Wholesaler who didn't want it anymore and basically gave it to me for cost.

How did you finance this deal?

Mostly private money, and I self funded any overages.

How did you add value to the deal?

Added a master suite in an existing garage, renovated the walk out basement, opened up the floor plan, and renovated kitchens and bathrooms.

What was the outcome?

TBD, its on the market now.

Lessons learned? Challenges?

Even though contractors come highly recommended, you must follow your process.

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

No

Thank you both. I’ve done what you suggested and found a lender. I appreciate your responses. 

Thank you John! This is a very apt response 

I purchased, renovated, rented, and now I'm looking to refinance the property.  I'm looking for suggestions on banking institutions, lending terms I should be looking for (30 yr fixed, 25 yr because its a partnership), typical interest rates, etc. 

I purchased the property in a partnership with my LLC and a partners LLC. I'm stating this in case it will impact the financing.

Any help with this question will be greatly appreciated.

P.S. technically I only completed BRR, I'm looking to do the next two RR's

Investment Info:

Single-family residence fix & flip investment in Mt Holly.

Purchase price: $60,000
Cash invested: $110,000
Sale price: $176,000

This was a full gut renovation. In addition to removing the interiors, we raised the ceilings from 7'-4" to 10'-6" in the common areas. When we purchased this property it was a 1100 sf with 2 bd, 1 bth. We converted it to a 3 bd 2 bth and relocated a bedroom to create an open floor plan with a distinct separation between public and private areas.

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

I loved the location of this property and purchased it right when the pandemic was in full swing. A lot of investors stopped buying and this property fell out of contract. We picked it up at a discount.

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

We purchased this property from a wholesaler.

How did you finance this deal?

We purchased the property with investor funds and funded the construction out of pocket.

How did you add value to the deal?

We added a bedroom and bathroom, reconfigured the floor plan to create a separation between public and private, and hired an engineer to calculate if we could raise the ceiling 3 ft.

What was the outcome?

The property went under contract for purchase in 2 days. It will close in the beginning of August.

Lessons learned? Challenges?

I lucked out and hired a great contractor. The success of this project is mostly attributable to him and his team.

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

I worked with the buying agent, but I got my real estate license early on so I could sell properties myself. I have been working with an amazing private money lender for the past year. He makes the purchasing phase very easy.

Albertinny:

The hardest part during the contractor change out process was being nice to the previous contractor.  I had to bite my lip a lot because I still needed him to close out the job. He had the plumber under his contract, as well as the license with the city. 

If I had to do it again I would have done more research/ due diligence  on him. At the end of the day, I don’t blame him, I blame myself. Which is a hard pill to swallow, but if you take ownership of it, it certainly provides clarity. 

Investment Info:

Single-family residence fix & flip investment in Cramerton.

Purchase price: $39,000
Cash invested: $76,000
Sale price: $189,900

This was one of the most challenging and rewarding projects I've completed to date. It took about 7-8 months to source and close on the property which had 25 heirs. Most of the main living space floor, sub floors and piers were damaged beyond repair and needed to be replaced. I had to change contractors midway through the project. But, in the end, the product/investment was worth the wait.

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

The character of the home. The home was in bad shape on the inside, but the exterior wasn't bad. There were a couple cost effective moves that needed to be made on the outside, ie new roof and gutters that completely changed the homes curb appeal.

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

I went to look at another property in this neighborhood and this guy was sitting on his porch and called me over. At first, he asked if I wanted to buy his home, which was in really good shape, and I declined. He then explained that his family owned a home a couple blocks away and that he would show it to me. He was 1 of 25 heirs on the property and was not one of the original heirs and could not negotiate terms. I eventually spoke to the right person and agreed to a price.

How did you finance this deal?

I purchased this property in all cash.

How did you add value to the deal?

I added a jack and jill bathroom between bedrooms 2 and 3 as well as a master bathroom. The original home was a 4/1 that I turned into a 3/2.5.

What was the outcome?

The original contractor relied heavily on one foreman that injured his back on the property just prior to mine, so the GC had to scurry to find workers which delayed the progress. Eventually, the GC and I came to an agreement that I would take over the day to day and hire my own subs to finish.

Lessons learned? Challenges?

I have a rule to never provide a deposit for any reason on a project. Unfortunately, I broke that rule on this project because the GC came highly recommended. I will never to that again, ever. It took forever to have the GC "work off" the original 8K that I paid him.

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

Im a broker, but I did work with a lovely RE broker who represented the buyer and worked very hard to get the deal done.