All Forum Posts by: Bret Burton

Hi All, Thank you for the response. Ryan, I'd definitely like to meet up. I get down there on occasion. PM me and we'll set something up. 

Hello,

I was hoping someone on the BP forum could shed some light on developing a lot for mobile homes.  I have been investing in RE for about 7 years now and own long term rentals in Vail CO.  I have always been interested in mobile home parks and I have an opportunity to develop 14 narrow lots on just over an an acre of land.  The plot is located in the center of town with a single family home and some utilities in place.  Can anyone provide me with a ball-park estimate of how much it costs to develop a site for a single trailer.  Foundation, water and electric hook up etc?  I'd really appreciate any insights, Thank you. 

I own 7 properties and I got tired of my wife complaining about me messing up the back of our Honda Pilot so I bought 1999 Toyota Tacoma for 7K. I love it and it works perfectly for everything I need it for, including a recent remodel. 

I am a realtor in Colorado. I'm representing a buyer who made a reasonable offer on a property of a deceased seller. Its a good location but the property had 17 cats (not exaggerating)  and it has cat piss and **** everywhere. The estate wants to sell the property as fast as possible and theyre considering selling it at a much lower price to a cash buyer (my buyer is financed with a 95% loan. I personally thought about buying the property cash, but since my buyer was interested, I backed off. 

Now because we're possibly going to lose this deal to a cash buyer, would there be a problem with me offering cash to close in 10 days and turning around and selling it to my buyer? He would be entirely on board with the logistics of the purchase. I know this is a very unusual situation, so any guidance would be helpful.

Today, Monday May 21, the first meeting of Vail Valley Real Estate Investors will take place at Etown, in Edwards CO. If you are an active investor, aspiring investor or work with real estate investors/professionals, then join us. This event is hosted by Burton Real Estate and The Rocky Mountain Home Team. Apps and drinks provided!  

Thank you for the responses!

I am a real estate investor and realtor in Colorado. I'm working on a small multifamily, condominiumized development. I am trying to figure out a structure for a joint partnership. the project looks like this....

10-12 units

estimated building costs- 200K per unit (for everything)

Completed value of 400K per unit

land value is 500K

total construction costs are around $2 million

the land is owned outright by a separate out of state individual.

I will be doing all of the development from start to finish and I'll be the realtor responsbile for any sales. 

I dont have any personal contribution besides putting the entire thing together. We'll work on raising funding for the project through a local bank

This is my current idea:

In order to make my contribution equal to the landowner, I will have to come up with 500K in cash. We'll then use the land and my cash cntribution to obtain a 1.5M loan to complete the construction. I will have contributed 500k, and hell contribute the property worth 500k.

our contributions will essentailly be equal so we'll each own half of the completed project. We would split up the units evenly and once the units are split, the owners will be able to choose what they want to do with them, whether it be rent or sell. We'll split the debt evenly as well. 

however, I dont have 500k, so i have to bring on an investor.  

therefore i have to create a separate agreement with my investor who is separate from the land owner/joint partner. we will get half of the properties, so 5 (assuming we do 10 total). This is where I have to determine a proper payout for my investor....

My thoughts are to give him 2 units, debt free. so he put in 500K and now has 800K in real estate. I get 3 units that have a total of 750K worth of debt and 1.2m in value. 

I think this is a solid win win scenario for everyone, but I want to maximize my payout to be properly compensated for the great deal of work and value add. 

Please help me out to recognize any flaws or positives about my strategy. I've never undertook a project this complicated or large so any advice would be greatly appreciated. 

about me:im an investor and realtor in colorado. I'm 32 and started investing 5 years ago. I own 7 long term rentals with total gross rental income of 250K per year.

Hey Peter, I live in Avon and I have 7 rental properties in Avon and eagle vail. We do only long term rentals as I find it is easier to manage and far more predictable. Right now our rents range from $800 on the low end to $1000 per room, depending on the location. I believe you can rent for more in some areas with the right finishes and location. Vail property values are considerably higher than Avon/eagle vail and you fetch the same rent. There have been some recent sales of 3 bedroom units under 400k, and while there isn't anything listed, I expect there will be lots of new listings as the ski season closes. April/may will be the best time to buy because there won't be the extensive summer competition yet. Lots of properties have been leased for high rates through the winter months and April and may is when they'll come onto the market. I was recently urging a friend of mine to do something similar as you. He wanted to buy here and use it for himself part time. A 3 bedroom under 400k would allow you to rent out 2 rooms full time and cover your expenses (assuming 900 per room and 1800 for mortgage tax insurance and HOA). I'd be happy to discuss this further. Contact me via private messenger and I'll get back to you as soon as possible. Bret

I'm currently refinancing a property that I bought on an interest only loan with a 3 year balloon. The appraisal came back considereably below the market value of the property. The appraiser used comps that don't match this property. Overall, the appraisal was poorly done. A unit in this complex was sold for 490K with one less bedroom and 700 sq ft less. I needed the appraisal to come back at 525K in order to not come out of pocket on the REFI and it came back at 475K. I'm a Realtor and investor that is very familiar with the value in the area and we expect the property should have appraised between 525K and 550K. 

What is the best way to handle this? Is it reasonable to have the bank order a new appraisal? Any advice is welcome.

Bret

 @Christina Labowicz, 

First off, well done and keep reading books. The big thing is to understand the concepts now and to be ready to move when the time is right. I highly recommend wholesaling, even in this area. I've been looking for someone for a while and I haven't been able to find anyone around here. I'm certain there are plenty of owners and certainly a lot of buyers. Not to mention, using those wholesaling strategies will help you find a good deal. Read 3 books on wholesaling and you'll have a strong grasp on it. 

I work with a private lender/partner and we're always looking for deals, but moreso a wholesaler. 

The prices shouldn't scare you to buy a place here. If the numbers make sense, it shouldnt matter what the total value of the place is. If you know that in the worst case scenario, where you have to move and rent your place out, you'll cover all of your costs, then you should do it. Living for free, paying down principal and getting big tax benefits should be enough motivation. Evaluate this home as if it were an investment and rented out. If it makes a lot of sense, use it as your primary residence for now. Just dont go buying a house just for the sake of buying a house - even your primary residence should make financial investment sense. 

This private lender I work with is quite flexible on terms. If I were you, I would find something up valley, 3 bedroom sub $350. Its highly unlikely you'll find this on the MLS, but contacting owners directly can get you there. If you have any cash for a down payment, you use this private lender (at 8%) knowing you'll be refinancing in a year. Showing you've had this mortgage and paid it on time, in addition to building credit with other credit lines, you'll be able to refinance with a VA loan at a very low rate. VA loans allow you to have a high loan to value ratio. You would be able to buy out the private money loan with the refinance and get virtually all of your down payment back. Keep in mind your employment history might still come into play (I'm not certain about VA but Fannie Mae requires 2 years of employment history, so look into that first).

You can also look into owner financing. I have two properties owner financed that I otherwise never would have been able to buy at the time. one is 6% and the other is an interest only at 5% for 3 years. We're in the process of refinancing now to a conventional loan. 

Since I moved here I've worked in the service industry as a bartender or server. One of the best things about living here ARE the offseasons. Restaurants are very slow in the offseasons and the ones ive worked at close for 6 weeks at a time. This allows us to either travel or work on real estate if we're feeling motivated. We use that down time to learn, look and think about deals. Also, keep in mind there is a huge percentage of out-ofstate owners, anyway. The offseason is as good of any reason to contact those owners. They might be between tenants or wondering why theyre spending so much money on an empty house they aren't going to. 

 Argentina, Greece or Croatia will be my next big trip, but I love SE Asia (although we only went to the philippines). Vietnam is high on the list tho, and that might be our first 3 month hiatus country since it is so cheap. I'll definitely consult you before we go!