All Forum Posts by: Clayton Smith

 Jonathan, 

I also live and invest in Tuscaloosa and hold a full time W2. I am mainly LTR rentals with a mix of student and section 8 type properties. I also recently purchased my first commercial property over the summer and am in works on a few other larger projects. As well as a steady stream of flips for the past 36 months are so. 

Feel free to connect and message me. I always enjoy meeting local investors. 

I would recommend cash flow quadrant by Robert Kiyosaki. It provides a proper framework on how to be an "investor" vs having a job disguised as an investment. 

 

 Depends on the game. I have a 3 bed / 2 bath 10 minutes from the stadium. Right now it may be $125-$150 a night. Last year for the Texas game I rented it for $1250 a night with a 3 night min. Typically game is around $500 a night with a 3 night min. 

@Marie Grabo 

I have a STR in Tuscaloosa currently. The city does make it somewhat difficult to set up but it is more paperwork than anything else. You have to go to the zoning board to get it approved but it is typically a formality, unless the neighbors push back it should get approved. They will limit the days it can be used as an STR for the 1st year but in my experience they do not follow up to track the actually days. Biggest thing is make 80% of your revenue in football season and it is ok the rest of the year. Feel free to ask me any questions.

@Alan Wilson Hey Alan I have a deal in Tuscaloosa. If you are interested let me know. 

Hey @Carter McGill

I am an investor in Tuscaloosa. Feel free to reach out with any questions. I would recommend getting the HELOC set up. You can usually get one for 90% LTV minus the mortgage. So you should be able to get one for $60k or so. They are not expensive to set up. The last one I did was under $1000. Like a credit card you only pay interest on the money you withdraw to use. I started to build my portfolio by buying a personal house and then turning it into a rental. If you decide to do that it is much easier to get the HELOC on you personal house than an investment property, another reason to set it up even if you don't "need" the cash. Plus once you move out of the property the bank has always let me keep my HELOC as is as long as I didn't sell.

Thanks for the info. I am in Alabama so the entitlements are not extremely long but do take around 6 months. The location of this development is pretty prime. I have been looking at it more in example 2. I just need to hone in on develope costs. 

 I am in the Tuscaloosa Market. I can connect you with my broker. He does a great job. 

Rates have gone insane compared to last year. 

 Thanks for the info. I have talked to a few developers and once approval goes in place they are ready to make offers. I am working on getting an appraisal done. A typical infill lot would be $45-$50k in my area so I am basing some of the potential value on that. I actually have been thinking $25k per does sound about right so its good to hear that I am at least in the ballpark.  If it really is that large of a price difference I would consider putting in the infrasture myself. 

building costs in my area are around for this style should be $110-$115 SQFT. I talked with a developer that had similar plans at another site and they were going to build it out for $131k per unit. Land development should run about $500k. Infrasture is adjacent the property so the cost will be minimal for that. Land is level so not a ton of grade work. I am thinking build out will be $6.5 million give or take. ARV would be $8.5 mil on the low end $9.5 on the high end. Still a lot of meat on the bone for a developer paying me 15% ARV. I will take it through entitlements. I would not be designing the homes or getting the building permits. In my area we just need to give the city a general idea of what type of property will be built for approval. Not to have finished design. Less red tape for developers in my market.

I purchased a 5 acre parcel of land with a single family home this year in the middle of my town. I am working with the city to get it rezoned to develop this property. I will go in front of the zoning board next month with my plot plan. As of right now I will be able to fit 38 town homes on the land. They will be side by side duplex style townhomes. The ARV for these will be $225-$250k each after construction. With the location being close to the University of Alabama there is also a possibility for the buyer to build these to rent for $1800-$2000 each. I am looking to sale the property and realize the gain instead of staying on for construction to a finished product. I listed to "on the market" and James Daner said that land typically sells for 20-25% of the ARV. But my question is how is the best way to value the land? I am thinking that in my market I should take no less than 15% of the ARV for the land. I do not plan on doing any of the land development. Just selling the raw land as is with permits in place so a builder can get started the next day. How should I determine the value? Should I pay for a commercial appraisal to make sure I list it for the right price?