All Forum Posts by: Brian Buckley

Bob Okenwa I am very detail oriented and I'm not opposed to paying a GC 125k, but for that price tag I want to see exactly where my money is going. I'm definitely going to look for more contractors, because full on gut renovations would be new to me. I was really hoping to find at least one that I would've considered for the job, but none of them seemed to make sense for me. Outside of getting involved in the local REIA, any suggestions on finding good contractors? The property is located in New Jersey, FYI. I was contemplating asking people at a Home Depot pro desk to see if they have any suggestions for reputable people.

I just met with three different sets of general contractors to get an idea on the costs associated with the rehab, and I wound up with three completely different estimates. Contractor A gave the property a good walk through, but seemed more of a handy-man fix it kind of guy, but didn't write anything down and didn't give me any idea on price. Contractor B had the type of vehicle you might expect an established contractor to have, spent a substantial amount of time in the place, but missed things that seemed obvious to me, and I don't have much experience in the construction field. Contractor B gave me a ballpark of 70-100k and when I mentioned flooring options he told me that he "forgot" about flooring. Contractor C looked at the property for less than 5 minutes, didn't seem interested, but told me he used to flip homes until the market softened and now works for banks handling their REO rehabs and at a minimum it would cost 125k. A little background on the property, its extremely old, unknown the year it was built, but it was the house my grandfather grew up in and was left to a cousin who unfortunately couldn't maintain the property. Everything would need to be gutted and the layout redesigned, floor joists are an issue that need to be corrected, as the floors are sagging and there are cracks in the beams, soup to nuts the house needs it all except for a roof which was recently done and the siding just needs to be patched up. I'd probably agree that it would be on the higher end near 125k, but I'm the type that likes to deal with someone who writes things down and calculates, not just winging it on site after barely inspecting it. I'm considering hiring all the trades to come in myself and not pay someone for managing the work being done. I have time on my side because I believe I can work out seller financing with the executor of the estate and then use my own cash to rehab the property. It is a tremendous undertaking, but I didn't get the sense from these three contractors that they'd have my best interest at heart at the end of the day. I don't mind paying a premium for work, but none of them won me over on their business acumen. Shopping for skilled labor in my opinion would allow me to limit my exposure to bad work, and then I can take it one step at a time. Sorry for the long post, but interested to see what everyone in the BP Community thinks!

Kind of ironic Audrey Ezeh ! Right now the property is zoned two family, but I figured if I can get it rezoned as a four family it would make more sense from a cash flow perspective. Also looking forward to some comments from experienced members!

Chris Martin you make a good point. In my area I really only see 1 baths in most 2 bedroom rentals, but in new construction it certainly makes sense to build to a prospective tenants tastes and needs. Thanks

I have a potential opportunity to purchase a family property that's most likely a tear down. It happens to be on a double lot and so I'm thinking of knocking the existing single family home down and build a fourplex in its place, pending zoning with the town. Cost is obviously a consideration, but I think that making 4, 2 bed 1 bath units would be the best layout from a cost standpoint, both on the build and potential for rents. I wanted to see if anyone had any advice, experience, or just general thoughts on the idea, thanks!

@Chris Mason would I be able to refinance a property upon completion of the rehab, on a deal originally structured with seller financing and also recoup my own personal cash I used for the rehab? i.e. $70k purchase price w/ seller financing, 100k rehab cost, refinance immediately after rehab, $175k, 70%LTV, presuming an appraisal price of $250k. Thanks!

Gilbert, I'd be interested to hear more details. Send me a message when you can.

To clarify my prior post, I did go over rents, as well as time on market for rentals with a licensed agent, but I also cross referenced craigslist to factor in rentals not listed on the MLS. I'll be sure to raise rent incrementally, if done at all ,within a years time to keep the long time tenant happy AND paying on time haha! Thanks everyone for the insight, any suggestions for a newbie such as myself are always welcomed!

I'm basing my fair market rent price off of other rentals in that area, especially with the proximity the property is to the bay, as well as downtown area of the town.  It'll certainly be a learning experience, but one that I'm confident will pay dividends in the long run. 

The units are both in good shape, and really don't need anything done in them, but I still plan on having a sit down with each tenant to address any issues or concerns they may have.  I think the increase spread out over a course of time is a great idea, and I see the value in being slightly below average rent.  I just want to start off my rental career on the right foot, with as little friction as possible.