All Forum Posts by: Daniel Jackson

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $230,000

2Bed 1Bath - 1,488sqft single family home being converted into a 3Bed 2Bath. This property is located in Capitol View, Fulton County. I was able to source this gem to an investor that I have had the opportunity to build a valuable friendship with. This relationship has taught me the value of consistency being that we met at a real estate event 6 months before we completed a transaction together. I am looking forward to aiding this client in real estate investing for as long as they need me to.

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

Off-Market, offered the seller a 2 week close.

How did you finance this deal?

Hard Money

Lessons learned? Challenges?

This relationship has taught me the value of consistency being that we met at a real estate event 6 months before we completed a transaction together.

To the Investor out there that is new to REI and might be nervous about investing because they know they are taking a risk, focus on limiting risk as much as possible. One way to do this when calculating the risk and profit margins on a deal, is to make sure it has more than one exit strategy. That way, at least if one exit strategy doesn't work, you have another route you can take.

So case in point, you are looking fix and flip a SFH. You love the house and the potential "after repair value it" has, but you are skeptical what the market will look like in a few months when it is time to sell the house. It would be of your best interest to calculate the average lease price in that area and affirm that the lease price can cover your holding cost, incase you have to rent out the house for the time being until the market is back on track and you are able to sell the house. To conclude, make sure your deal has more than one exit strategy to limit the risk of losing what you have invested into the deal. Thank you for reading.

Investment Info:

Single-family fix and flip in Clarkston, GA.

Purchase price: $175,000

This was a great flip opportunity in Clarkston, GA. Originally a 2Bed 1Bath - 1,000 sqft, but will be converted into a 2Bed 2Bath featuring an open floor plan. My buyer was able to purchase this deal with hard money, and only coming out of pocket $36,125. This is the buyer's first flip, however he actually happened to grow up in Clarkston, and was able to foresee the growth Clarkston will have.

How did you finance this deal?

Hard Money

Afternoon Atlanta! You might not have the time to read and keep up with real estate news, so feel free to keep up with my post. I'll share what I read as much as I can.  Published Wednesday January 18, 2023 by CNBC, Diana Olick : 

"Mortgage demand jumps nearly 28% in one week, as interest rates drop to lowest point in months"

"Consumers returned from the holiday season to find mortgage rates at their lowest point since September, and they are responding in dramatic fashion.

Mortgage application volume jumped nearly 28% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.23% from 6.42%, with points falling to 0.67 from 0.73 (including the origination fee) for loans with a 20% down payment.

Rates hit a recent high of around 7.2% at the end of October on the MBA’s survey but ended the year at 6.58%. One year ago, the average rate on the 30-year fixed was 3.64%.

Refinance demand made the biggest move, up 34% from the previous week, but it was still 81% lower than the same week one year ago. The refinance share of mortgage activity increased to 31.2% of total applications from 30.7% the previous week.

Applications for a mortgage to purchase a home rose 25% week to week but were 35% lower than the same week one year ago." - CNBC, Diana Olick

Hey Atlanta, I decided to share some information that was provided to me by "Anna K". I thought this might be helpful to buyers who just don't know what to think or do in this current market. Please read and invest at your own discretion, however, feel free to reach out for my take on the market.

"Interest rates are still higher than they were this time last year which has helped slow inflation. This is just the new normal for now so WHY WAIT to build wealth or compromise on your housing needs? There are no guarantees that interest rates will go down. Real estate, however, has ALWAYS appreciated as a LONG TERM investment.

Low inventory tells us that we are still in a seller's market but Atlanta has seen more buyer concessions than the national average as of late. With fewer homes on the market and less buyers in the market, both buyers and sellers are experiencing what we would consider a very normal buying & selling process. Exciting times for both parties! 13% fewer homes came to market in 2022 vs 2021 which has helped keep prices high with an increase of 11% compared to 2021." - Anna K

When it comes to choosing whether to fund a deal with cash or hard money, I think what matters most is your financial position, but also limiting risk. For someone that might be able to do both, the idea of using hard money is to leverage risk. When using hard money, you are able to spread your capital across multiple deals, rather than putting all your cash into one deal and taking a loss. At least with your capital spread across multiple deals, it is less likely that all of your deals will flop and you lose all of your money. And ultimately with hard money your return on investment (ROI) is greater, because you have less cash out of pocket on those deals compared to buying those deals with cash.

I understand being new to real estate investing can seem a little terrifying at first. It's like you have the capital and cash reserves, you have decent credit, and the desire to get started but you don't know how to start or you don't know what to expect when you do start. I'll be the first to tell you, that it is okay to be slightly afraid in these moments.  However, the more you know, it will allow you to get started in real estate investing with more confidence. So, my goal here is to help you with just that. A very important asset you want to acquire before making any real estate investment is a creditable & skillful general contractor (GC). Especially, if you are purchasing a fixer upper/fix & flip. 

I like to believe that your "GC" is the heart of your project. I say this because in a fast selling market, fixer uppers are being sold within 0-48 hours. So if you think about it, do you really have enough time to hire an inspector, get them out to the property to inspect it, and then receive their inspection report back in all of 2 days? 99% of the time you will not be able to. So who else can you get out to that property to help you perform thorough due diligence and foresee any probable issues with the property? It would be your general contractor (GC). 

Your contractor should be knowledgeable enough to act as an inspector in that moment. And, they should be able to pin point any concerns that can hinder your exit strategy and expectations. Whether that be foundation issues, an outdated or worn out roof, outdated plumbing & deterioration of cast iron pipes, outdated wiring which can cause fires, or even a larger rehab budget than you anticipated. These are all major concerns, and it will save you a lot of money if you made sure to have your "GC" walk through every property before you purchased it. I make it a priority to emphasis how crucial this is to all of my buyers and colleagues. Best Regards. 

Investment Info:

Single-family residence wholesale investment.

Purchase price: $335,000

Mid-Reno in Dekalb. The seller had financial issues arise and couldn’t finish it. He didn’t acquire this deal from me initially, but I was able to source this deal to a buyer that could handle this size of a project. The buyer loved this deal. It came with new foundation and framing for the addition behind the house, along with APPROVED PERMITS & PLANS. This was golden, because having approved permits reduced his build time tremendously and the deal was located where profit margins are high.

How did you finance this deal?

Hard Money Loan

Investment Info:

Single-family residence wholesale investment.

Purchase price: $142,500

3Bed 1.5Bath - 2,056 sqft in Conyers, GA.
We were able to source this deal out to a buyer who really wanted to flip houses in Conyers. This home needed a full renovation, however the buyer had plenty of experience and didn't hesitate to grab a hold on this deal.

How did you finance this deal?

Cash

Investment Info:

Single-family residence wholesale investment in College Park,GA.

Purchase price: $137,800
Sale price: $269,500

4Bed 3Bath - 1,820 sqft cosmetic deal in College Park, GA.
We were able to source this fix and flip to a buyer that resides in Florida, but desired to invest in the Atlanta area. This transaction was thrilling, because we were able to show this buyer that out-of-state investing is possible and that it doesn't have to be a difficult process. This was the buyer's first investment property in Atlanta, and it won't be their last!

How did you finance this deal?

Cash