All Forum Posts by: Aaron Anderson

@Joshua Davies Hey Joshua, I’ll send you a PM

Some Before Pictures

After Pictures

Intro

August of 2016 I moved my family out of our nice 3/2 in the suburbs to pursue a deal that had it's ups and downs. This is an analysis of my FIRST REI deal and will hopefully inspire other investors to look outside of the box a little.

Spring HIll, TN is a suburb of Nashville and Franklin with a BOOMING residential growth due to the GM plant and good schools.  I found this deal by Driving for Dollars and mailing all of the absentee owners a typed letter saying something along the lines of "After driving by your property, it seems your tenants aren't keeping your home up to par with the neighbors."  The landlord called, gave me a walkthrough and named his own price of netting $120,000!  

The Property

5007-5011 Joe Peay Road Spring Hill. TN

This property was originally a 3/2 1400 sf built in 1970 with a barn behind it. The previous owners gave the barn a septic tank and kitchen and gave it a new address; however, this was still 1 Lot and 1 Tax Parcel.  My wife and I moved into the barn and started flipping. Fortunately, it already had electricity, plumbing to the kitchen and bathroom and other necessities, but the condition was very poor.

5007 Joe Peay Road was immediately filled with a tenant paying $1,200/mo (on the low side for SH) while we flipped the barn house.  Below is a detailed list of repairs and costs.

Repairs and Costs

$120,600 Purchase price

$3,000 closing costs

$950 survey to split lots

$800 drywall patching and repair

$5,500 for new water meter and installation

$500 wire fence

$1,600 new paint

$300 plumbing repair

$250 new carpet

$600 new laminate

$100 gutters, drainage, french drains

$500 front porch

$600 new kitchen sink and countertops

$2,000 other misc costs, like new blinds, touch-up paint, gravel, necessary tools.

Total Costs

$137,300

The Sale

In May, our tenants moved out and we sold the rental home for $145,000 after finding structural issues. Because of this, we were hesistant to hold long term.

We are currently under contract with a cash offer on the flipped barn for another $145,000 set to close in a couple weeks.

+$145,000 (A)

+$145,000 (B)

=$290,000 (Total)

-137,300 (costs)

=$152,700 (profit minus taxes)

Taxes are currently TBD by my CPA. We are unsure if I can 1031 an investment property that I also lived in.  It's not looking likely

Hey @Erin Wilging,  I'm a Realtor and Investor in Middle TN. I'll shoot you my contact info and we can chat!

Overview

I was doing some simple research in the Nashville market and wanted to share it with my friends on BP.  It is normally easy to find comps for a 3/2 on less than 1 Acre, but if the home is Modular or Manufactured, the comps become a little less reliable.  I've compile some stats to look at if you are analyzing a deal with a Modular or Mobile-Manufactured Home.

For this post, I'm referring to Modular as a home that is constructed in pieces built on a permanent foundation.  Manufactured homes (in TN) abide by different regulations and don't require a permanent foundation, also known as mobile homes even if they're set on cinder blocks.

Search Criteria:

30mi Radius from Nashville

3 beds, 2 baths

Max 1 Acre

$100,000-$300,000 sales price (outside of this range really skewed the data)

Sold in the last 12 months

Findings:

Site built homes averaged $211,000 and $124/sf. We will use this as our reference point of 100%.

Modular homes averaged $157,000 and $$101/sf which is 81.5% of Site built homes.

Manufactured homes averaged $$133,000 and $88/sf which is 71.5% of Site built homes.

Bonus:

Split Level homes sell at 82% compared to 1-Story homes.

What areas are you looking to stay in? What's the radius you'd like to travel?

@Nicole Aleksandrowicz

Welcome! Nashville's BP community is very active.  If you have any desire to look south of Nashville towards Brentwood and Franklin let me know! I'm a Realtor and very familiar with Williamson and Maury County.

Music and Money Investors Network meets once a month in Cool Springs. @Brandon Turner was a guest speaker last year.

welcome! Nashville's BP community is pretty active. I am a Realtor and do most of my work in between Brentwood and Columbia. If you're looking to buy south if Nashville feel free to reach out!

Hey Josh! I'm a Realtor and investor in Spring Hill (about 20 min south of Franklin) and do 90% of my work I. Williamson County.  It's a totally different market than that of Nashville, and I love it.  Just last week I helped a BP colleague relocate from MN to Franklin to start their RE investing journey. I'll send you a PM and we can chat more.

I'm not a Lender, but I've had experience with this with a past client.  First, check on the FHAs website and see if they have a time length that the loan must be kept.  I haven't looked for 2017. The rules change year-to-year, so  if it is not listed on their website, you must go through your old loan docs and see if there was an early payoff penalty for the specific year that you signed.

This is what makes it tough.  If you signed in one of the years where the early payoff penalty applied, there can be a couple thousand in extra charges (that financial assistance they helped with), but if it doesn't say anything about it, it should refinance just like any other loan!