All Forum Posts by: Chris Wilburn

@Chris Watkins thanks for the connect!

@Zach Smith messaging you now.

Hi BP,

 I'm an investor from the Portland area. Over the past two years, I've completed two primary residence renovations using 203K loans, created one LTR, one MTR, and now I'm excited to expand into flipping.

I'm focusing on the Beaverton area and looking to connect with experienced investors who can recommend reliable lenders, wholesalers, or other deal finders. I'm particularly interested in purchasing two-bedroom, one-bath (minimum) properties that offer space and potential for adding an extra bedroom and bathroom. My target purchase price is no more than $410K, aiming for an ARV in the $530K to $570K range.

I'm comfortable with small to medium-sized renovations that don't require major structural changes or additional square footage. My focus this time around is working with a reliable team and delivering a quality product.  I’m being realistic about margins on my first deal, especially considering hard money. Above all, my priority is a project that stays on budget and time (easy right? haha).  I have a knack for saving on materials while providing some unique flair that will stand out in the market. 

Looking forward to connecting and learning from this community!

Thanks,
Chris

hi @Todd Kono.  I’m looking to do a N Portland flip this year after completing renovations to 2 primary residences.  
Are you still doing flips right now?  Would you be open to mentoring or shadowing? 

Thanks, 

@Alexander Ohmes thanks for the share!  

I'll PM you as well.

Hi BP,

Wanted to share an overdue update on the 203K+basement conversion project.

Good news is it's done, I'm still confident in the original ARV estimated (and that was for fall 2023 market), and I think it looks great!

**Anyone with experience placing a medium term tenant (6-month max) for a one time fee, please reach out!! **

See rental posting here: https://www.furnishedfinder.com/property/663256_1/loc

What I thought was going to be a manageable renovation experience turned out to be an all too common nightmare with our contractor. Won't publicly slander their name, but reach out if you're in the market for a contractor and I'll tell you who to avoid.  (Night and day difference over our first 203(k) experience with a dialed in contractor.  Pliant Property Services, check them out. )

I will say that the work is decent, maybe 6/10 after pointing out some things that needed to be fixed. This was not a premium finish project, so that should not tank our ARV. Cosmetic things that were lacking I fixed later on.

The nightmare:

• -They had no regard for timeline (we finished 3 months late, 3 times the length estimated for the whole project!!)
• -They sent unskilled randoms to our house to do work. No safety precautions and sometimes we couldn’t communicate with them.
• -Disregard for containing/blocking off work areas and cleaning up after the job.  Leaving paint and broken ladders???

I think a lot of the problem is that I don’t have really any people management experience, and some issues could have been identified early and mitigated. Keep in mind that your selection of contractor is your problem, not your lender’s or anyone else’s. So things I know now are:

• -Contractor should not be agreeable to all changes you want to make. They should push back and give details as to why time or budget won’t allow for what you’re asking for.
• -Make sure your contact person with the company has some experience with the work. I got a sales guy who had little clue how long or what skills were needed to do the jobs he was quoting me for.
• -Because 203(k) has it’s own work agreement built in, it may be difficult to instate chargebacks. Ask the contractor what kind of chargeback agreements they’ve worked with in the past. Get references and call to check if they were ever on the hook for missing work completion estimates.

Reach out with any questions, more than happy to help.

I love 203(k) and think it’s a great tool, especially within the next 6-18 months!!

Hi BP,

Longer overdue update to the 203(K) house hack project.

We finally found a property and the renovation is underway!

We ended up with a 3 bedroom/1.5 bath property. Our 203(K) plan is to convert to a 5 bed/3 bath. This includes the basement which will be a 2/1. The basement was partially finished, but did not have bedroom egress.

The main items in our renovation are:

• New water main from curb and valve
• New electric service and panel
• Add bathroom + convert to full bath
• LVP in 70% of the house
• Interior Painting
• Additional bedrooms in basement
• Kitchenette in basement
• Egress(x2) in basement

Our scope of work should create a great living space for us to grow into, but also provide a rental unit that competes (or even exceeds) the area offerings for medium term rentals.

A couple notes on our buy process for those who might be new to homebuying:

• We found a great location! I think the location will make it much easier for us to rent and hopefully reduce turnover.
• Once our offer was accepted, we sometimes felt that our agent was not fighting for our desired terms, but rather just trying to close the deal. We ended up not hitting our close date or getting the desired seller carry for closing costs. I think the lesson here is to interview potential agents about how they handle difficult communication, unexpected findings on inspection reports, etc. Absolutely lean on your agent as expert, but keep asking why if something isn’t going according to plan.
• If anything pops up in your inspection report that you are unsure about, bring it up to your agent and schedule additional specialist inspections if needed. If inspections aren’t possible, get the items in question written into the deal addendum (either as a concession or as a condition to close so that earnest money is protected if a solution can’t be found). Luckily for us the issue was not huge, but we missed the inspection window before we found that out.
• 203(K)’s have higher rates than standard loans, so consider the timing of your refinance (especially in todays environment). We are using a 2/1 buydown to extend our window to refi.
• Our lender was a bit all over the place for this loan and also contributed to our delay.  I don't think there was much we could do here, justt  a bummer. 

Simplified numbers on the deal:

Purchase: $499K

Renovation: $77K

Total loan: $578K

Est ARV: $685K

Refi LTV: 84%

If all goes well, we’ll be looking at 13% forced equity + 3.5% down = ~16.5%.

If all goes great, we can hit 20% equity and drop our PMI before buydown rate period ends.

We’re now in need of some good property management if anyone has a recommendation.

I know there’s some info missing in this recap, I’m open to answering any questions!

Thanks, 

@Lawrence Potts yes whenever we get started this will be documented!  

203K is not affected the addition of units.  As far as I know it's just the jump in property tax that comes into play.  

update: interested property is under contract (not by me...), but the plan will be the same for whatever we buy.

@Alexander Ohmes $1800 would really make the deal if vacancies were reasonable.  I'm running my numbers with a furniture budget so this is a possible direction.  Travel nurses have housing allowance correct?  ( I would assume based on area median rents?)

Hi BP, 

This Portland market! Home prices are moving like crazy. Trying to catch a deal before rates hit 7%! 

My wife and I are searching for our second property in North Portland.  Our first was a 203K renovation purchase for our primary.  

Now we're looking for a house hack (should have started with the house hack, I know I know haha).  But since she is still a first time buyers we are still getting low down payment options. 

We want to run another 203K, this time converting a basment to ADU (Basically have to do everything: Permit, design, Egresses, full kitchen build, level concrete floors) as well as spruce up the main level. Running rough numbers, we'd want to get $1800/mo out of a basement 2/1 (with shared backyard). Is that competitive in the current market?

Hoping to get a pulse on where North Portland rents currently are and where we think they are headed with the way the city is regulating landlords and how Portland is on a slight population downturn.  Are people seeing rents holding, increasing with rising cost of home ownership?  

Thanks everyone! 

@Roarke Van Brunt have you used either of the contractors that you mentioned?  Or know anyone who can speak to their experience working with them?

Hey BP,

Looking to get some opinions on construction bid numbers we’re looking at. Do these sound like reasonable ballpark quotes for a one stop shop GC?

Property is a 1990s build, really hasn’t been touched since original construction. 1200sf, 3br/1.5ba, 2 story. Roof pitch 12/12

-New shingles and edge metal $9k (plus replacing plywood where needed)

-exterior painting $6k (definitely will be replacing some cedar boards here, but not clear on how many, maybe 10-15)

-rebuild four stair walk up on porch $1.5k

-carpet tear out and LVT (4.5mm clic, 12mil wear layer) throughout $15k

-replace 40ft of cedar fence $5k

Let’s assume that there are few to no surprises and the work quoted is the only work necessary.

Let me know if I’m missing any info that would help.

Thanks!