All Forum Posts by: Allan Smith

Where is it leajing? How many leaks? How bad are the leaks? Underground or in the building?

I'm not in that market but I recommend approaching it with an attitude of what you van offer a potential mentor. The "gimme" approach is how it can come off and people don't tend to jump at the opportunity. 

perhaps you can find deals for the mentor, or manage flips or rentals. And so on.

Of course! Just do an inspection. And know that you will have above average upkeep and repairs. Facts. 

Start by calling everyone in your network. If you're raising money online from strangers you would need to file with the sec.

I'm referring mostly to 1 - 6 unit SFR spec builds. I'm trying to figure out what my minimum deal standards should be when making offers on land. For context, I'm looking at developments where I am the builder and manage the project, and I bring in a money partner as the LP. I write it as me getting a builder fee, then a percentage of profits from the sale.

The metrics I'm leaning towards are:

1) profit of GP/LPs together, as a percentage of ARV

2) GP profit as % of ARV (without builder fee since in this case as GP I'm also the builder)

3) What my minimum builder fee should be

Do you use any of these metrics? How do you decide if a build is profitable enough as a spec build?

And for those of you not builders but focusing on development of 1 - 4 unit builds, just take out the part about me being a builder. What is enough profit after paying your builder and accounting risk, opportunity cost, etc?

Edit: in case anyone needs a bump to start thinking: I think a minimum profit to split between LP and GP would be 10% of ARV. It gets more complicated from there though. A builder would likely charge a fee of 13 - 18% of build cost with perhaps a $40k minimum. I could see taking less however as I would also get to double dip into profits from the project.

No the bank won't report you. They do not care at all what zoning is or what the city knows about you.

Apply for a zoning variance. Or maybe it's grandfathered in, but if not it's simply an illegal dwelling until you have a variance granted.

It's 100% a rental

Without a doubt if you are serious about RE you need a mentor or coach. You seem a little lost. They can help with all your questions. I've coached before and I know many others have too. Either that or start reading everything you can get your hands on.

Once you are experienced you can do your due diligence in a couple hours. These days I buy flips with a walk through that takes about an hour hour and a half. Then I'll make an itemized scope of work in budget. And then make an offer. I can close as soon as title is ready. The due diligence process just takes a few hours.