All Forum Posts by: Tony Cavalli

@Brad S. Great response, and I completely agree with how the property would be viewed by buyers and sellers as well as the banks. Most appraisers that I've spoken with have not yet encountered this situation with a refi or property appraisal. I think it's a great play just feel I'm early in the game here and sometimes that's a positive that will have it challenges. 

@Osazee Edebiri Great response and honestly thats where my head is at on it. Early in the game on this type of strategy. I just can't see how an appraiser can ignore the extra income when doing the GRM calculation. Only time will tell I guess.

@Jamaal Ragland Thanks so much! I will absolutely reach out. Appreciate the response!

Thanks for the response @Dan H.! Appreciate your time. I dont believe a 4 unit with an ADU is going to be looked at as a 5 unit. I was under the assumption that it would be considered a non-commercial residential 4 unit with an ADU? Interesting, I mean honestly the Cap rate valuation is what I want but I don't think that would be the case. I've called a couple appraisers to discuss and i've been getting mixed responses. IIthink about it like this... A house with an ADU does not become a duplex, it's a house with an ADU.

Hey fellow investors! Has anyone completed and re-appraised/refi'd a property that they added an ADU on a small multifamily (2-4 units) in California? I have a deal where I want to do this but I'm concerned about how the bank and appraisal company will appraise the property. Based on GRM/Cap rate it should significantly increase the value of the property BUT its not a commercial property. I'm concerned they will lean more on the neighborhood sale comps vs the income because its a 4 unit (residential). Hmmmmm....

Hey Khari, 

Everything Durable! Read reviews of materials/products prior to purchasing and always check with other like minded local investors to see what they are using. 

Hello BiggerPockets Family, 

My name is Anthony (Tony) I ve been a member on BiggerPockets since I believe Brandon and Josh were on Podcast #2 or #3! BiggerPockets along with members of the community helped me purchase my first out of state rental in 2014 with many more closings following that one (shout out @Ramon Jenkins).

Since then I've done development syndications, container home developments, BRRRs, AirBnbs and I'm a CA Realtor in Santa Barbara/Ventura County (I would love to help you if you are looking in this area). I'll will be posting more about all my past deals and current deals including the deals I've lost money (yup it happened). I'm on Instagram- @cavallithe3rd and actively posting content if you are into that sort of thing. Looking forward to engaging in the community, helping others and connecting with all of you! Have a great Saturday

Respectfully,

Tony

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $31,000
Cash invested: $31,000
Sale price: $71,000

Rented for $1050 on average for all holding years

What made you interested in investing in this type of deal?

Education and Data

How did you find this deal and how did you negotiate it?

I found it through a biggerpockets member who was also a realtor in the area.

How did you finance this deal?

Cash ( my life savings of $31,000 at the time )

How did you add value to the deal?

Renovated the property with tenant proof materials and fixed all mechanicals prior to accepting a tenant.

What was the outcome?

Placed a wonderful tenant who lived in the home the entire time of my ownership

Lessons learned? Challenges?

Always do all repairs up front prior to moving a tenant into the home. It was save you time and money in the long run.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Ramon Jenkins - BiggerPockets member

Hey Steven, welcome to BP and I must say... whoever wrote that book is a genius @Brandon Turner

With that being said I started investing in Milwaukee in 2013 from California. It has not been easy and ALOT more work, stress, effort than I ever expected. I buy with cash then rehab, tenant placement, then refi out and so far things have gone OK. There is something to be said for taking action and kicking some ***, but you have to kick calculated ***. No risk is worth taking if it puts you at risk. I won't tell you what to do because everyone has an opinion or idea but at the end of the day its whatever you are comfortable with. Everyday you need to study and everyday you need to network.. those two things will do the most for you in the long term. Smile, stay positive and PERSISTENT !

@James L.