All Forum Posts by: Chris Varsek

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $95,000

Helped a local investor group find this off-market property via an estate of the late owner. Bought for $95,000, and helped the investors to source reliable tradespeople. ARV is @ $235k after renovations are complete, however the group has held onto this one for cash flow.

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

This was found for an investor group that was looking to source a local off-market deal to add a cash flowing property to their portfolio.

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

This was purchased from an estate, one of my clients notified me of the opportunity and I presented to the investor group.

How did you finance this deal?

The investor group used cash on hand for the entire thing, then leveraged cash back out after renting it.

How did you add value to the deal?

The group replaced an actively leaking roof, and many, many other significant issues.

What was the outcome?

It was a great outcome - it is now cash-flowing north of $500/mo and they retain equity over $65,000.

Lessons learned? Challenges?

Have your electrician come and check out the wiring before doing the deal!

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

I was the real estate professional working in an advisory role on this one

This has been a long-time target area, and I didn't pull the trigger.  Now I've been priced out and I'm so sad.  Such a great area.

I often will call the top 3 property management firms in the area to see what their thoughts are re: demand in a certain area.

Flip & fix is a great way to get into the game.  Its the best way to create capital.  I certainly recommend finding a couple of mentors in your area that are willing to coach you through your first deal though.  Things WILL go wrong, and money can be made or lost depending how you handle those challenges.

Could you maintain the rent level, but offer them a $50/mo rebate if they pay early, or a $500 rebate for every six months of on-time payments they make?  Something that maintains your rent level if you decide to sell, but incents the client to stay and provides them a benefit?

In NE IL or SE WI, for SFF, tenant pays for pretty much all except property taxes 

Best step is to meet with the local municipal zoning planner so it can be legally approved

 even at $215 sqft, that seems like a good deal.  I've been getting consistently quoted north of $250/sqft to build up in Lake County!

Buy yourself a fourplex for sure.  Without having to pay for property tax, you should easily pay for your living, plus cash flow.  Thank you for your service, and this is a well deserved reward.

Chicago will always appreciate due to its sheer size.  It is certainly a buy & hold play, cashflow it tough.  With interest rates trending down, it will become even more competitive, although we should see supply increase as rates drop.  Naperville is seeing a huge boon as well as many people are leaving high density living in a post-pandemic world.  Long story short, both are long-term appreciation plays.