All Forum Posts by: Todd Powell

@Hilary Stalder if you can pay all cash the deal might be worth chasing... but its all about the numbers and the seller will have to get realistic with someone so it might as well be you! @Christopher Phillips said it perfectly!!!

@Hilary Stalder I have always run from foundation issues. Currently, I am trying to keep an open mind as I looked at a 2/1 house on .54 acre last week. I found a off market deal and the sellers want to sell due to divorce and drug issues. In this case, they had NO clue about the foundation issues until I showed them.

They agreed for me to call RamJack and Terrafirma to take a look. Obviously, this house cannot be financed and with the other work needed, I don't think anyone will want this house. It got me thinking, this is a buying opportunity if I work this through possibly? These inspections will be done weeks from now, so who knows, but I know they will be costly! IF you can get the place under contract and buy yourself enough time to get a bid, you may have a goldmine if you can work the numbers out in your favor. On the flip side, this could be a headache if not properly fixed.

I have learned to look at RE deals lots of ways rather than the one way I used to view them. I have made money in many creative ways, so keep your options open! Best of luck!

Todd Powell

@Dave Foster Using the same numbers in this scenario, can I sell the house for $200K and buy the new one for $300K and keep the same names (myself and wife), and keep that clean for the 1031, but later on handle the deal with cash with my son paying me back to make the 50/50 work by having him pay for all the repairs? In essence, we can internally make the numbers work for the even deal and keep the 1031 accurate for IRS? In other words, I close the deal cleaning with $200 price ($60,000 cash down equity as I owe $140K), and then my son pay the $60,000 in repairs. Or, if repairs exceed the equal $60K, I can match him dollar for dollar for whatever amount exceeds that?

I see your point and probably need to ask my accountant but wanted to clarify what your knowledge was here. I am guessing this "tenants in common" is a legal entity so our taxes all make sense? Sorry if I am confusing here, but this is a real deal possibly.

And, if I do a 1031 exchange, down the line this can be refinanced correct? I have done countless flips and buy and holds, but NEVER a 1031. Another way of doing this, is me just fixing the house and retailing it and then having to pay the taxes on the long term gain, which my cost basis is $150,000. I just wanted one time me to avoid paying taxes like I have many times before, and use the governments money to buy into the triplex.

@William Graves Also, an example of off market deals would be a 4 plex advertised by owner on Zillow. My son got to the seller within 10 minutes (yes, lucky), and he ended up buying this in Forest Grove, Or. He had mismanaged this deal and they were run down a bit. More than 100 people had contacted him via email within the first 24 hours.

Because of this transaction the older man liked my son and we ended up buying his last property April 30th on his 8 plex around the corner. BOTH off market deals!

Also, bought a 5 plex last January and found it on Craigslist. The man wanted $430,000 in Lebanon, Or and got it bought for $371,000! Just some examples, but I have tons more!

@William Graves First of all, the Portland market is too overheated as far as pricing. Real Estate goes in cycles if you look at historical data. At some point, these prices will not keep rising but relax if not fall a bit. Rents the last couple years also cannot keep this pace. With that said, I would look at outlying areas within a 30 minute drive or so.

Most of my deals have been off market. What that means is any deal I can find that is not on the MLS for the whole world to find and bid on. That creates lots of competitors and multiple bids. Here are some ways I have found and closed on deals:

1) knocked on a door of a run down property and asked, "hello, I know this a crazy question, but would you be interested  in selling your home. The old lady replied, "Yes, I have actually been praying someone would help buy this."

2) word of mouth. I have bought several places building a network and people knowing I want run down distressed properties.

3) Always plant seeds. Two years ago I had a guy call me from stopping by his house over 9 years ago! I owned a old triplex around the corner from him and saw the city there and he had a 40 yard dumpster and he was throwing out trash. I bought and in this case, did a wholesale flip as I was rehabbing units and very busy.

4) drove by day one and saw a sign in the yard by owner. I had the house under contract the very next day and got them down from $165,000 to $122,500 as they wanted this house gone fast.

These are just some examples. I have not closed deals this way, but you can try and look at pre foreclosure situations, writing letters, and overall being aggressive and relentless to look at every opportunity. I bought two houses word of mouth with one salesman I work with as he told me about people who wanted to sell their property. 

Of course, building a network of realtors would help, but I have found that most of them do not focus on Bank owned properties or distressed properties. Find some investors out there and learn how to find off market deals. Of course, this would take cash or private money as you always need to take the sellers problems off their hands and close quickly. I love finding solutions to sellers problems and I have bought many, many properties this way. In this market, I will tell you its much harder. I was doing this back in 2002 when there were more houses than investors. Now, with HGTV there are more investors than houses. Save money and wait for the right deal and do not get desperate! Be ready to strike when the iron is hot! That's my best advice. 

@William Graves 4 years ago my son house hacked a 4 plex in the Beaverton, Or area. List price was $450,000 and he went to the listing agent and made the dual agency deal at $415,000 with a FHA loan with only 3.5% down! Although rare, we did minor fix ups for $15,000 and some elbow grease and it did cash flow out of the gates with pushing rents ! Of course, you know the area and now this 4 plex is worth closer to $800,000! However, at the time people said his deal could not be done. Look hard for off market deals as well and look for projects that need paint and yard work ! Maybe start with a duplex but definitely house hack !

@Dennis M. So true ! My son played D1 football and he is always telling dad to keep hydrated ! Good post

@Bryan Clement wonderful post! We can get so busy being busy and building for the future that we forget it’s our health that can sustain our future ! I have always been a active basketball player and in my college years got to play rec ball with the likes of Gary Payton and AC Green. Although thise years are gone, I have never quit playing b ball and today at 51 play every Sunday at 7 am and every Tuesday night at 7 pm. Typically get 10-12 games per week. Great competition and great aerobic workout, but realized that I was slowing down a little and gained a couple pounds, along with less toned arms and stomach. So, my wife and I have been hitting the gym twice a week for one hour each doing core workouts, realizing that we need this as we age. Further, keeping hydrated with water is huge! I have (almost) cut out all sodas! I also am trying to cut out fast food, but healthy eating is also vital ! I have never drank or smoke, but sugar is just a big a killer ! Also keep God in your life as your spiritual side is a BIG key in your life!

@Dave Foster thank you for your insightful input. Ironically, I think the said house would be worth around $200,000 in its condition. We paid $150,000 with owner carry with $10k down. I am guessing the triplex in its run down condition is worth around $300,000 so can I close just in my name, and put down the $60,000 of house equity and then have my son go in this deal and pay for $60,000 in rehab costs? Is this possible with the “tenants in common.”  It may take $80,000 of rehab to be honest, so can we each pay the extra $20k out of pocket or $10,000 each to keep it 50/50?

I hope this makes sense and again thank you for your professional opinion and this will help @Jason Powell and myslef moving forward. I am meeting with the seller this week and the last deal I purchased from him he did owner carry so I am trying to keep my options open. My goal is to just use my house equity for half of this new deal. Thank you ! 

@Vidit S. With such a low interest rate, can you find a deal that will make you more than 3.5%? if so, I would not bother paying this down, but it really depends on your market and what prices are doing. That's a killer interest rate in the market!