All Forum Posts by: Mark Manship

@Ryan Heinz
Welcome to the panhandle! You'll find it hard pressed to find properties near/around downtown Pensacola that fit the 1% rule-of-thumb as prescribed on BBP; the downtown sector and nearby neighborhoods are expanding rapidly, and values with it. Keep in mind this area has its own rental niche that CAN be lucrative...see below. Properties near Pensacola NAS (West Pensacola, Perdido Key) and Whiting Field (Pace, Milton) will be more in line with the numbers you'd expect if you intend to buy-hold-rent with "liveable" 3/2's in that <$150k range. As mentioned by some other members, you can lease out individual rooms to school attendees to mitigate vacancy, OR employ a "house manager" under one lease; there's also the instructors/permanent party of these bases that choose to rent. Rents tend to run ~ $1/sqft.
Conversely, the STR scene feeds off the other facet of the greater Pensacola rental market: tourism. Depending on where you intend to base your own residence, you might find a good opportunity in purchasing a SFH with a MIL-suite, out-building (shed/workshop), or conversion of a garage. If you want really want to get your hands dirty, you can look to make these additions to an existing property, thereby increasing the ARV to future investors; you'll pay a premium in acquisition ($180-$220/sqft) for rent-ready properties, but can typically recoup those funds and cash flow equal-or-greater values in lesser time.
You'll also find a good many investment groups around the area (FWB, Niceville, P.I.G., etc.) if you're looking to get plugged in with the investment community - as @Charlie Cameron mentioned, there are quite a few wholesalers in the area that would be a good source of deals if you are looking to put a little more work into your properties. 

I host a similar group that meets on the 2nd Monday of the month at Perfect Plain near downtown - we'd love to have you out!

@Anthony Lilley

This may be a little out of your scope/area, but a few of us military folks from the Eglin/Hurlburt/Duke Field area have transplanted as far west as Pensacola. 

Obviously, your commute will be longer, but you might find properties that are better suited for your traditional purchase-hold-rent model as you described ("1% rule") with the myriad of demand signals (hospitals, Navy bases, Navy FCU) creating a strong rental market. Your competition won't be AS high for STRs (both in acquisition and marketing your own) as tourists tend to frequent Destin moreso than Pensacola Beach, but there are still plenty of folks that visit P-Cola and nearby beaches for concerts, festivals, conferences, TDYs, Blue Angels Weekend, etc. 

In either case, you might also consider using a VA-Renovation loan (contact Deborah Joslyn at University Lending), which is a good VA alternative to the 203k and might allow you to find those uglier 3+/1+ homes in need of work at a lower entry point and with no FHA-imposed PMI.

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $225,000
Cash invested: $25,000

3/2 Bungalow in East Hill

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

Amazing location/area (proximity to downtown and historic sector)

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

MLS / 2-month negotiation with seller

How did you finance this deal?

VA

How did you add value to the deal?

50/50 DIY and local contractor work

What was the outcome?

Still in progress; goal for project complete on Jan 1, 2020

Collaborate with some Pensacola locals interested in the pursuit or advancement of careers and investment opportunities in real estate; all in a laid-back format. No membership dues, no fees, no "guru packages" - just a group of energetic, creative, proactive individuals seeking fruitful opportunities and great discussion. 

We look forward to meeting you! Let us know you're coming at: 
https://www.meetup.com/Velocity-Investing

William Allen ; the deal already consisted of some known issues which we were using to our advantage in order to lower the purchase price, however we've reached a point of diminishing returns for both the seller and ourselves. Once we knew about the poly piping, we knew we were going to lower the price and replumb the property: both to ensure long term stability for the property and to help with our insurance costs, but now we're at a point where the seller has reached their "floor" and we've reached our ceiling. Sure, we could drop the price an additional 5-10k, but as everyone knows, there's a significant difference between a 10k-leveraged and 10k-capital investment (assuming worst case for new PEX plumbing and a water heater). I feel I could create a couple of posts purely from this one deal, but overall, I do feel as though we are having to yank the disclosure information from the seller and their agent. Every day since our original offer I have received one more piece of information that makes the deal slightly riskier; not from a cash-flow perspective, from a capital investment view. At what point do I accept "accepting" properties with these types of issues? The numbers still make sense, but the margins grow smaller by the day. At this point, I'm having to pester my team members (agent and mortgage broker) just to figure out if we can qualify, let alone whether or not we can raise the capital for the renovations.

During an inspections of a potential SFR this morning, it was discovered (and afterwards confirmed by the seller) that the entirety of the plumbing is polybutylene; to make matters worse, there are two known leaks below the raised foundation (below the off-grade portions). I'm now wondering how we go about getting the home insured and consequently financed (via a conventional mortgage) given that this material type exists. Specifically, I'd be looking for Florida insurers (property exists in Pensacola, FL).

Arianne L. , Fred, thanks! To continue the thought, though a slightly negative one... Has anyone ever had to recover from a total loss (either as a seller or buyer)? Would you rather take the insurance money and "run" (and sell the land)? Build new construction? On the buying side, would you stick with the deal? What would you rather the seller do?

@Yiftach Ilyov thanks for the reply - I hadn't even thought about the lending dependence on insurance...urg...

I'll have to reach out to my broker and see what we can do to get quotes before Irma strikes, and/or determine how long it will take to get a quote.

Agh - I think my post may have come off as a little insensitive; I'm more concerned about finding additional information on the delays/re-inspections/costs associated with extended contract periods rather than making a buck at someone expense.

Given that we may have to delay our closing, I'm curious if anyone has experienced similar scenarios where they were required to re-inspect, re-appraise, etc. following a hurricane strike.

Well, it looks like Florida won't get off that easy as we reach the last few months of hurricane season. With that being said, I'm wondering if anyone has had any experience closing deals (either selling or buying) during a potential strike - more specifically, has it resulted in any changes to your pricing, inspection periods, or contingencies? I understand there are typically clauses providing coverage to buyers during catastrophic events (forces of nature), but was interested in hearing how it has or would play out. We're currently set to close on a sale on September 19th in Niceville and pick up another property on the 11th of October in Pensacola; with Irma and José on their way, we're anxious about how it will impact the deals (either positively or negatively).