All Forum Posts by: Christopher Blanco

Exactly. I never want to lock myself into an exit. 

I am starting in Fix and Flip. I have never been a land lord before and I wanted to start building cash in my business, so for me it was a natural fit. I eventually want to employ a BRRRR strategy, inbetween flips. I am also keeping my eyes open, sometimes a property may just work better as a rental than a flip, so i will keep my exit strategies open.

How are you conducting your search? My wife and I use a combination of Redfin (my new favorite), Zillow, and Trulia. We use Zillow to scout an area, what we look for are houses selling WAY below the median for the neighborhood. Once we find one, we do a "seat of the pants" ARV and run REAL quick numbers (if I am within 10K-15K on rehab I am exctatic at this point). I use the following formula:

ARV - (Desired Profit + Purchase, Hold, and Sell+Rehab)= Max offer price. If the offer price is more than 50% of the list price, I will dive deeper. Send the listing to my agent and she will get me real ARV's with comps. Each level of inspection requires a better estimate of numbers and I keep drilling down until I make an offer.

EDIT: This is for a Fix and Flip eval...

I will sometimes do a real quick "guesstimate" on a per sq/ft basis to see if a project is worth investigating further. If the numbers doesn't make sense on a simple scenario, it sure as heck isn't going to work when things go south! As I take properties through the property funnel, I get more and more refined with my estimates as well. I am assuming that once I am doing this longer I will have a better sense of what things cost. 

@Peter Schuyler, I don't know if this is the right way of looking at it, since I am still working on landing my first deal. This is for fix and flip, buy and hold would be a little different. After analyzing about 20-30 deals (just using formulas others have created), I have determined that I want to make $20-$25K profit. So I am looking at houses that I can buy that fit the formula: OfferPrice= ARV- RehabCosts-HoldingCosts-PurchaseCosts-SellingCosts-Profit. I have determined that for the houses I am looking at (ARV $120K-$200K) and the financing I need that I will need between 15K-30K to buy and hold property; that includes down payment and holding costs.

I have about 40K to invest, so to start I can only do one deal. Once I finish that deal I will have 65K (my starting capital + my profit) if everything goes to plan. That should allow me to buy two deals, after those two sell I should have around 110K, that will allow me to buy 3 or 4, etc. My goal is to get to flipping 2 properties a month. 

I hope that makes sense. Have a plan and stick to it. Don't chase the numbers, the first deal is critical to set the plan in motion. Take your time with that one!

Good luck, @Alicia Brown! Still looking for my first home! 

If you get a chance post the numbers on purchase, budget, and ARV!

@Alex Makar Welcome to BP. Fellow Clevelander here, just getting in the game myself. Feel free to connect!

Look at Lima One Capital, depending on your experience you can get 90% LTV, 9.99%, and 2 points.

@Kristopher Hanks, I will be in Richmond, VA the week before that, Dec 11- 16th. I am traveling for my day job, I am happy to drive to meet you half way if you want. I can probably do the 17th though if that makes more sense.

Lets hook up for sure. 

@Kristopher Hanks I like that activist mentality. With Downtown living space at a huge premium and year long waiting lists, those areas are a goldmine IF they can be cleaned up. Unfortunately they have two things bad for them: 1) Perception that it is a warzone 2) The schools are terrible. I am definitely interested in this idea of cleaning up the east side, but it obviously needs to make sense financially. Not to sound like Trump, but I would love to help Cleveland be great again!