All Forum Posts by: David Maldonado

Quote from @David Maldonado:

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $306,500
Cash invested: $78,000

House Hacking / Live in Flip

Asking Price: 319,999

Main House Rehab: $8000

Conventional 5% down

PITI: $1680

Main House Rent: $2050

*DETACHED 725 SQFT ADU BUILD* (OWNER BUILDER)

2 Bed 1 Bath, Washer & Dryer, Private yard and Entry

Grand Total Cost to Build: $70,000 (Plans, Permits, Construction, Fees, Etc.)

ADU Rent: $ 2100

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

Cheap price, sweat equity, large lot for detached ADU build, first full rehab project.

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

Found it on Realtor.com searching for properties that have been sitting on the market the longest when rates were at an all-time low.

How did you finance this deal?

Conventional Loan

How did you add value to the deal?

Full rehab down to the studs.

Built an Income generating ADU in the backyard.

1930's house looking like a 2020 house.

200 amp panel upgrade

What was the outcome?

long-term cash flow and another step closer to financial freedom

Lessons learned? Challenges?

Lack of comps for properties with ADUs

Had to leave money used to build the ADU in the deal (for now)

Flipping the home made me realize how much I enjoy working on houses and how rewarding it feels to look at my creation.

It was tough to find a house where I didn't have to pay over asking when rates were at 2.75%, so I learned to look at homes that have been sitting on the market the longest is beneficial, especially in a hot market where homes usually sell within days.

 This was from 2021, just figured I post it now since I'm in the process of updating my BP profile!

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $306,500
Cash invested: $78,000

House Hacking / Live in Flip

Asking Price: 319,999

Main House Rehab: $8000

Conventional 5% down

PITI: $1680

Main House Rent: $2050

*DETACHED 725 SQFT ADU BUILD* (OWNER BUILDER)

2 Bed 1 Bath, Washer & Dryer, Private yard and Entry

Grand Total Cost to Build: $70,000 (Plans, Permits, Construction, Fees, Etc.)

ADU Rent: $ 2100

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

Cheap price, sweat equity, large lot for detached ADU build, first full rehab project.

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

Found it on Realtor.com searching for properties that have been sitting on the market the longest when rates were at an all-time low.

How did you finance this deal?

Conventional Loan

How did you add value to the deal?

Full rehab down to the studs.

Built an Income generating ADU in the backyard.

1930's house looking like a 2020 house.

200 amp panel upgrade

What was the outcome?

long-term cash flow and another step closer to financial freedom

Lessons learned? Challenges?

Lack of comps for properties with ADUs

Had to leave money used to build the ADU in the deal (for now)

Flipping the home made me realize how much I enjoy working on houses and how rewarding it feels to look at my creation.

It was tough to find a house where I didn't have to pay over asking when rates were at 2.75%, so I learned to look at homes that have been sitting on the market the longest is beneficial, especially in a hot market where homes usually sell within days.

I get that all the time about the cost per square ft. The cheapest build I've done was for a 488 sq ft jadu conversion at about $62 per sq ft (before sb13 lowered the cost of permits) in 3 months. It rents for $1500. But this is in a higher cost of living area.

i personally find new construction much easier than fix and flips, at least for long term rentals. Least likely to have maintenance issues since its a new build. Just sucks that it can take a while for single family new construction.

Hey everyone,

I am looking into investing in long-term rentals in Fresno sometime toward, specifically single family homes with the intention to build both an ADU and JADU on every property. The plan is to BRRRR fixers with hard money or funding partners, and then build the ADUs (home equity loan maybe?). I'm in it for the cash flow (although I wouldn't complain if the ADUs added a decent amount of equity). Has anyone built an ADU/JADU in the Fresno area? Did you get an appraisal after the build? If so, how much equity did the ADU add to the property?

I would like to know if ADUS add or decrease property value in Fresno and if the rents are worth building the ADU as an owner builder (I have built 1 JADU and 3 ADUS as an owner builder at about $90 per square foot).

ADUs in my hometown, where I invest in, add a significant amount of value to a property, only problem is that my market still has buyers paying over asking (not nearly as much as when rates were low though, $10k-$15k is common) for a move in ready house). Just not enough supply and buyers are going in with two families on a single family house.

Hey everyone,

I have owner builder experience building ADUs to my properties. I was able to build at $85 per square ft by doing most of the work myself and subbing out what I couldn't.

I want to take on my next deal as an owner builder and build a single family home with both an ADU and JADU. There is land for sale in my area for $297k with all utilities on site (used to have a small house that was demoed a while back). I can build at about $100-$150 per square ft (depending on soft costs for the single family home build). There is only 1 comp in my area that has both an ADU and an JADU that sold for $1.5 Million, where the average sale price for that neighborhood is in the high $500ks.

Are there any lenders that do owner builder loans in California?

I also plan on testing for my GC license early next year, hopefully that can better my chances on being approved for an owner builder loan (if they still exist in California)

ADU Appraisal:

Hey everyone it has been a while. I'm currently getting ready for my 5th ADU build and I want to share some news:

A similar house in my neighborhood with both an ADU and a JADU sold for $1.15 million, after only being listed for a few days. Properties around my neighborhood are worth around $550,000. I was able to get a copy of the appraisal report and the comps that were used were mulit-familys (tri-plex). As of today, that house was the first and remains the only property with both an ADU and a JADU in my area.

Question:

If I were to apply for a HELOC, would that $1.15 million dollar property be the only objective comp that can be used to determine my property's value? I'd be able to quit my job and do this full-time if this can work!

ADU Appraisal update:

I have mentioned a similar house in my neighborhood with both an ADU and a JADU that sold for $1.15 million, after only being listed for a few days. Properties around my neighborhood are worth around $550,000. I was able to get a copy of the appraisal report and the comps that were used were mulit-familys (tri-plex). As of today, that house was the first and remains the only property with both an ADU and a JADU in my area, that has sold.

If I were to apply for a HELOC, would that $1.15 million dollar property be the only objective comp that can be used to determine my property's value? Feel free to chime in appraisers!

Update on Appraisals for ADUs:

So I have built both an ADU and a JADU on one of my single family homes. A similar house in my neighborhood with both an ADU and a JADU sold for $1.15 million, after only being listed for a few days. Properties around my neighborhood are worth around $550,000. I was able to get a copy of the appraisal report and the comps that were used were mulit-familys (tri-plex). As of today, that house was the first and remains the only property with both an ADU and a JADU in my area.

If I were to apply for a HELOC, would that $1.15 million dollar property be the only objective comp that can be used to determine my property's value?

Hey everyone,

has anyone built an ADU in the Las Vegas area? I would like to build an ADU, but I don't know if its worth it. I would be my own GC. I've built 5 ADUs on my properties in California as an owner builder.

Hey Everyone,

I have been successful building ADUs in my hometown while utilizing the house hacking strategy. I built my first ADU (now known as a JADU) as an owner builder and did most of the work myself. From the cost to build it and the rent it generated, I made my initial investment back in about 16 months. Now it is like owning a property free and clear. ADUs are cash flowing machines in California if anyone didn't know. I bought and moved into my 2nd house and immediately pulled permits to build a detached 745 sq 2 bed 1 bath ADU AND an additional attached ADU on my first property (SB13 allowed 2 units on a SFH after 2020), again as an owner builder. I built both of them last year and I will be making my initial investment on both units at the end of next year. Managing 1 project was tough, but two!? I then understood the significance of hiring a licensed contractor, and why they charge what they charge is mostly justified. I learned a lot acting as my own GC and especially, saved a ton of money on labor. I realized I love building and turns out I qualify to take the California GC license exam (combination of a college degree and owner builder experience)! I recently closed on my third deal to house hack and I will be working on pulling permits for my 4th and 5th ADU after I finish renovating the house (Needs a TON of work and I'm surprised it passed VA!), but might as well make it look nice since I will be living in it)! I'm thinking ahead and I had always had an interest in investing in the Fresno area (that's where I got my BA in Business/Finance!).

I kept up with the laws pertaining to ADUs and Tiny home on wheels (THOW) over the years so I am well informed on them. Fresno is much cheaper than the area I invest in and my money can go further their while getting a pretty sweet return. Anyone have experience building THOW, getting them certified (can't remember the name of the THOW certifying agency), registered with the DMV, and then throw them on the back of one of your rentals (permitted) for cash flow? I was going to start building tiny homes anyway, but I figured if this is another avenue for THOW/ADUs, then lets make some money! I just wouldn't know where to start, who to talk to, permit process information, etc. Any guidance would be greatly appreciated! 

I am also open to talking about my ADUs if anyone is interested. I'm an ADU enthusiast!