All Forum Posts by: Bill Brown

Depending on how far out the old studs are, the quickest way is to sister new studs onto the old.  When doing a whole wall, start with the two opposite ends, set up a string line at top and bottom across the wall, and sister new studs to the strings.  If the studs are all plumb and in plane, furring strips work great.  It pays to stop and think about your end product before you do anything.  Make sure to rebuild the room plumb and square if you're going to set cabinets or tile walls.

@Wesley Smallwood  I don't have experience with bad Chinese drywall, but are you sure it's bad drywall?  If so, it seems like you should plan on replacing more than just the drywall.  I would check all the wiring, plumbing, mechanical systems closely for corrosion.

Hey @Rachel Hettler, first thing - your math on your rental loss is $100 off according to your numbers. You would actually be at -595.

 So if you remodeled and updated for $60k and got closer to market rent, you still wouldn't be cash flowing much if at all until your interest rate changed or rents went up.  If you're looking at it as a flip, a basic calculation, without debt costs, you have...

220k purchase + closing costs + inspections (say 5k?)

+60k rehab (while paying taxes, insurance, utilities during work)
= 285k

Sale price 325k - 285k
= 40k - holding costs
- 5-6% realtor commissions  (16,250 - 19,500)
= 23,750 gross profit

This is assuming you have no debt costs, nothing goes wrong during rehab, and your appreciation numbers happen in rising interest rate market. It will also be subject to a capital gains tax depending on your scenario.

I don't know your situation or your goals, but on the surface, this seems like a non-deal. It's a risky time to rely on appreciation. If you do, I would at least hold off to find something that broke even without putting a ton of cash in. Good luck!

@Adam Barakat

I’ve lived in Pittsburgh/ Pittsburgh suburbs my whole life and, like many places, there are sub markets within sub markets. The rivers, hills, major roadways and busways will normally mark a sub market shift regardless of zip code. 

Obviously it depends on your goals as to where a good investing location would be as well as who you connect with and what areas they’re familiar with.

I’m curious what numbers you’re expecting to get and what other, if any, markets you compared against. There are lots of great areas here to buy. Good luck!

@John Matthew Johnston don't be greedy, hand over some of that cash flow! 

No, well done. Are you managing yourself and what are your plans from here?

@Jeffrey Myers  good for you for getting out to look for an investment. Unless you’re fairly experienced with renovating, expect to spend more $ than you think and take way more time than you planned if you’re doing the work solo.

Also, consider all costs of self-performing the work like not receiving rent and not making $ doing something else while a team is banging out the work. Make everything a math problem. Good luck. 

@Steven S. most folks use 5-10% for maintenance, and 5-10% for CapEx depending on the condition and age of the house. That should help the numbers.

I’ve had a difficult time finding plumbers lately. Most of the smaller guys are too busy to even call back. If you don’t get a good recommend, I would try the county health dept website to search for registered master plumbers by zip code. I’ve had success using that for my current project.

Hi Makayla, I'm not an expert in off market deals, seller financing, or STRs, but I would encourage you to focus more on WHAT you want than HOW you want to get it at this stage.

I have a similar problem of being interested in too many areas at once, and that is a good way to spend your time get nothing accomplished. I recommend analyzing all of your interested markets and picking one or two at most, then deciding exactly what kind of property you would be looking for (I like all those markets by the way). I would also recommend talking to some agents in that market that have experience with what you are looking for. A good agent can give you tons of info on a market and you can still find deals on the MLS.

If you're looking to get into the game with no or low money, an STR may be difficult on your own. They can have a significant start up cost to furnish, outfit, etc. Not to mention an off market property probably will need some work to get it rentable. If you want to browse off market deals to get an idea, there are facebook groups for wholesalers, investors, and landlords in all different areas.

Bottom line is narrow your focus and attack from different angles to get what you're looking for. Good luck! Hopefully someone can give you some better info on those specific areas.

Way to go Ben, what part of the burgh is it in?

Looks like you have very little cash in the deal. I think that's a smart way to start, hopefully keeping some money in reserve for odds and ends. Good luck on all the rest to come!