All Forum Posts by: Chris Cabanilla

@Nate Anderson

Hi Nate, I’m a realtor and flipper from Las Vegas. How’s it going ?

you can contact trash out pros (best prices)

To all house flippers out there, do you list your house at ARV? Or do you list below ARV to create a bidding war? What are your strategies? Here is a little info on my property:

Fully renovated property. Located in Garden Grove, California. (Orange County).

1. The house is on a major street, however none of the comps on the same major street are fully renovated - and those comps sold for $575K.

2. My house is 200 sq. ft. larger than the next largest house on the street.

3. Other comps (not on the major street) sold for $630K-$670K and are still not as big as mine.

Just curious as to what you would do?

@Javier Rosales

Also, it depends whether the private money lender wants to be paid back by interest, cash-on-cash return, or % of equity of the sale. HMLs will almost always finance you IF the deal and numbers are right. So you can practically invest with no money out of your pocket, assuming the deal is right and the private money lender acts as your gap funder and the HML is aware that although you yourself may not have money, you are using the gap funder.

Good luck.

@Javier Rosales

What you're suggesting is simply investing by using OPM. I think it's great if you can convince the PML to use his funds to pay for the HML interest & Gap. Yes it takes money to make money (but it doesn't have to be your own money!). So yes it is possible, and many people do this.

@Dave Toelkes

Wow, thank you for the detailed response. It was very helpful. Appreciate you!

@Jason D.

I’m in a similar situation with a little twist, if you can also help me out :)

My in-laws and I have agreed that I will personally fund 50K to rehab their single family house. ARV is 600K. Upon sale of the house, they will keep 400K and I will keep remaining profit. The house has been their personal primary residence for 30+ years.

1) Assuming they are exempt from paying capital gains up to 500K, and assuming the house sells for 600K (to which they will then give me 200K), how does their long term capital gains affect my portion?

2) The rehab money is coming from My LLC (taxed as an S-Corp) to pay the contractor. Would I be able to deduct business expenses and conduct write-offs (i.e. rehab costs) despite the fact I didn't "purchase" the property, but rather I just contributed the funds?

Thanks!

Thank you for the detailed response! No, I am not going to do more of this with them. This was their primary residence for over 50 years but has been a fixer-upper type of home. The ARV is around 575K. They would keep 400K and I would keep the rest. Assuming it sold for 575K, they would pay taxes for 75K despite the fact they would write me a check for 175K?

What significance does treating the renovation cost as a loan entail? 

Thank you!

@Daria Sukhenko

If more information was the answer - we would all be billionaires with perfect abs. - Derek Sivers

Real estate investing is definitely a mindset game. I barely started in my first fix n flip this past month. But this past few years I've been researching about REI and never felt ready. You just have to take action and learn as you go. Instead of "ready, aim, fire" just think "ready, fire, aim".

Good luck !

@Basit Siddiqi

Yes this is their personal residence that they’ve lived in for over 50 years. Thanks for your prompt response!