All Forum Posts by: Corey Block

@Santiago Marquez I plan to build 4 or 5 homes on the land and either rent or owner finance them.  I recently started carrying some notes and that is great passive income. 

Investment Info:

Large multi-family (5+ units) buy & hold investment in Silsbee.

Purchase price: $106,000

New mobil home park development.

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

I have one park already, stumbled upon the opportunity to buy this land and build another one.

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

Found the deal through a local investor. Purchased the property for the value of the land plus the cost of the improvements made so far.

How did you finance this deal?

Owner finance. I negotiated an interest only period of 6 months and got the seller to add on some of the infrastructure costs into the mortgage. I have a 36 month period of time that I have to wait to refinance the property or pay a penalty.

What was the outcome?

Still in development stages. Water is being brought to the property next week, septic systems being installed next week, electricity being dropped next week.

Lessons learned? Challenges?

Expect delays when dealing with municipal entities like a co-op water office and electricity providers. No one gets in a hurry to do anything. You must stay in constant contact with them and bug them about every step of the process.

Investment Info:

Single-family residence buy & hold investment in Silsbee.

Purchase price: $54,500
Cash invested: $6,400

Single family home on 5 acres

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

I love these cheap homes in this area. Rents are good and tenants are not hard to find. Plus I got the property at a great price, I knew it was worth much more than I bought it for.

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

I found this deal through a local investor that I have become friends with, it was one of his dad's investment properties. He was originally asking $54,500 for the house and 1 acre of land. I negotiated an additional 4 acres of land in with the deal and purchased it all for $54,500.

How did you finance this deal?

Owner finance at first just to obtain the property quickly, then did a cash out refi with a local bank. The property appraised for $135,000.

What was the outcome?

Purchased the home by owner finance and put a tenant in it within a few days. Closed on the cash out refi a month later and put over $54,000 in my pocket and the property still cash flows. I took the money and bought more property!

Lessons learned? Challenges?

Networking is key. Make friends with local investors.

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

I am a licensed real estate agent.

Investment Info:

Single-family residence buy & hold investment in Port Neches.

Purchase price: $100,000
Cash invested: $25,000

Purchased this single family home with the proceeds from a cash out refi I did on another property. I plan to rehab this property once the cost of construction goes back to normal. Until then I will continue to rent the property and get paid to wait.

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

It's in cheaper part of town with a great school district. Rents are top dollar and there are new builds going up all around this home.

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

Found the deal on the local MLS. Ran comps, made fair offer and it was accepted.

How did you finance this deal?

Conventional mortgage

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

I represented myself in the deal, as I am a licensed agent.

I have been thinking about starting a local meetup in Southeast Texas. Anyone have any experience or advice for getting a meetup going? Might be a little tricky with Covid, but I’m just brainstorming at the moment.

@Amy Zemser I have been in a similar situation and unfortunately there is no easy way out.  You need to examine your lease closely and find any violations of the lease agreement and use that as the reason for eviction.  Definitely hire an attorney, and I would check with a local real estate investor group and see who comes highly recommended.  If you are not sure if a local group exists, check Facebook...that’s how I found my local group.  If she seems well versed in the laws and straight up told you that you can just evict her, I’d bet she has been down this road before.  

I am currently dealing with a similar tenant.  Luckily I am in Texas and I have 3 different attorneys that I am personal friends with and they handle all my legal issues, and I am personal friends with a J.P. in another precinct, so I have access to very good and extremely reliable advice.  Even still, I have been trying to get this woman out of my house since October 1st...and she has filed a small claims suit against me.  The suit won’t go anywhere because it is bogus, but it still is pretty unpleasant to deal with.  

This woman has been evicted 4 times back to back to back in this same precinct and none of them showed up when I did my tenant screening using RentPrep...which is a MAJOR issue with that service.  This woman avoids paying any filing fees or court costs because she files an affidavit of inability to pay, so it is free to file law suits on landlords and free to appeal every eviction, which buys her another month in the home.  

I could go on and on, but the point is, hire an attorney...it will likely end up going there anyway.  Also have your attorney review your lease and see if there is any room to improve the lease.  I also like the advice of installing a separate unit in the apartment and have it’s own meter.  If the rents are below market, this would easily justify increasing the rent.  

Good luck!  Interested to heat how this turns out.

@Ryan DeBari I just bought 3 FEMA trailers for $58K. They are all 2012 model 3 bedroom, 1 bath homes that are set up pretty nicely and came fully furnished. I financed them all into one loan through a commercial lender that I have a relationship with, 10% down and a 10 year note. I just got them all rented for $750 a month. It ended up costing me about $20K extra to get them moved, setup, skirted, porches and steps build, etc. That was way more than I expected, but the plumbing and electrical ended up costing me several thousand dollars due to unforeseen problems with the existing service lines. So make sure you have extra money set aside for the unknown.

@David Bermudez I determined the value based on rent roles of the park I was purchasing and what the market rents are for the area.  I called around to different mobile home parks in the area and asked what their lot rents were and what their park owned homes rented for.  I used that information to vet what the seller was telling me, and also to establish an estimate for what I thought the park was worth.  The appraisal the bank ordered ended up being 88 pages long, and I read every line...turns out I was very close in my figures and I gained an education as to what appraisers look at to establish value.  Hope this helps

@Susan Elliott I would definitely visit the park before purchasing, but after that I think a good manager should be able to take care of the rest.  I manage my own, and even with this “problem” park, I haven’t really encountered any problems so severe that I couldn’t handle it.  

@susan 

@Susan Elliott this was a local park, relatively local, and I’m not sure if it would have been any more difficult had it been in another state or area.  Of course there will always be fear and apprehension when investing in a property that is in another state, but I don’t know that the buying process would have been any different.  I did encounter an issue with the septic system on the property, and dealing with the TCEQ trying to get it cleared up, but the seller is working with me to find a solution and helping with the cost.  The issue is not resolved yet, but we’re working on it.  

I would not be opposed to investing in a park out of state.  You just need a good manager and make sure you perform your due diligence.  I don’t know that I would buy another park that is not on public water and sewer.