All Forum Posts by: David Prince

@Andrew Lake- I actually bought this one on contract with the seller. It had been on the market for a almost 90 days and reduced from $54k initial asking price. So, I just sent an email to the listing agent asking if the seller would consider a contract sale and proposed terms sight unseen but official offer pending walkthrough of the property. The photos actually showed the work to be done pretty clearly so we submitted an offer using the terms I had intially proposed. 

I did have a real estate attorney review the contract and a title company closing though just to make sure everything was in order. 

Im looking for a private money partner on a recently acquired property in central Indiana. The property is under contract and will close on June 1. I have contractors on standby ready to walk the property on day 1 get to work. My contractors have longterm relationships with building dept to help with pulling permits and scheduling inspections. 

About me: 

I am a RE Broker in Chicago IL and getting started growing a rental portfolio. I owned a previous property in Indiana as a personal residence and completed a full reno contracting out only the larger projects (electrical, plumbing etc) and completing the rest of the work myself. I sold for a modest profit after relocating to Chicago. This is my first property in the portfolio.

This property is a small 1,000sqft lake house bungalow. The property will need a gut rehab including roof, chimney removal, floorplan modfications, plumbing, electrical etc. Its a big project but similar to my previous property so I feel confident in the scope but cautious as well. We close on June 1 so I am working through the project planning and queuing up permits, contractors, supplies etc and selecting finishes. Hopefully this will be an 8 week reno once we get started weather permitting.

I plan to BRRR with this property and deploy the equity in the next project. The lake is easily rentable on AirBNB or longterm tenant. If you are interested, email me and I will send you the property packet with further details.

Details:

Purchase Price- $30,000 with 10% down, 8% interest, interest only payments for 24 months

Reno budget- $30,000 including some contingency for unexpected costs

Resale value- $85,000-90,000

Highlights- 2bed, 1bath, 3 lakefront lots, 100ft of lake frontage, small dock, new furnace and well pump/pressure

I owned a previous property as a personal residence and completed the reno while living there and sold for a modest profit after relocating to Chicago. This past weekend I purchased my first investment property, a small bungalow on a quiet lake in Indiana, with a contract sale and pretty good terms. The property will need a gut rehab including roof, chimney removal, floorplan adjustments, plumbing, electrical etc. Its a big project but similar to my previous property so I feel cautiously confident. We close on June 1 so I am working through the project planning and queuing up contractors/supplies etc and selecting finishes. Hopefully this will be an 8 week reno once we get started weather permitting.

I plan to keep this as a weekend getaway from the madness of Chicago city life but AirBnB when Im not there (already have approval from HOA). Once the reno is complete, Ill refi and deploy the equity to my next project.

Details:

Purchase Price- $30,000 with 10% down, 8% interest, interest only payments for 24 months

Reno budget- $30,000 with some contingency for unexpected costs

Resale value- $85,000-90,000

Highlights- 2bd, 1bth, 3 lakefront lots, 100ft of lake frontage, small dock, new furnace and well pump/pressure

I owned a previous property as a personal residence and completed the reno while living there and sold for a modest profit after relocating to Chicago. This past weekend I purchased my first investment property, a small bungalow on a quiet lake in Indiana, with a contract sale and pretty good terms. The property will need a gut rehab including roof, chimney removal, floorplan adjustments, plumbing, electrical etc. Its a big project but similar to my previous property so I feel cautiously confident. We close on June 1 so I am working through the project planning and queuing up contractors/supplies etc and selecting finishes. Hopefully this will be an 8 week reno once we get started weather permitting. 

I plan to keep this as a weekend getaway from the madness of Chicago city life but AirBnB when Im not there (already have approval from HOA). Once the reno is complete, Ill refi and deploy the equity to my next project.
 

Details: 

Purchase Price- $30,000 with 10% down, 8% interest, interest only payments for 24 months

Reno budget- $30,000 with some contingency for unexpected costs

Resale value- $85,000-90,000

Highlights- 2bd, 1bth, 3 lakefront lots, 100ft of lake frontage, small dock, new furnace and well pump/pressure

This isnt at all uncommon and a practice I do as well. If you have an accepted offer you should be fine. I wouldnt be worried if a seller asked to keep showing a proper I had put under contract. Pretty normal. 

Well, I did it. I bought the lake house on contract following your advise @Brenden Mitchum. I acted as my own broker but had a real estate attorney look over the documents and make edits. I was able to get it at 10% down, 8% interest with interest only payments for 24 months and balance due on 24th month or paid in full at disposition of the property. Feels pretty good to have it under contract and now on to planning the reno. 

@Brenden Mitchum- thank you for the insight. I agree, Ill likely be connecting with a local Realtor. Im a Broker here in Chicago but not licensed in Indiana. It wont cost me anything and would make the process much easier. 

Im looking at purchasing a SFH using seller financing in Indiana but the seller has a listing broker. Has anyone had experience with this? How do I go about submitting an offer and negotiating financing terms etc?

Id like to offer 10% down, 10% interest. Standard amortization schedule including interest/principal with balloon payment at 12 months or paid in full at disposition of the property. 

How would you structure this in an offer through a broker?

I am seeking an experienced multifamily investor/mentor to closely advise on assessing a portfolio acquisition and possibly partner if interested. The seller is liquidating his portfolio to pivot his business into new construction/development. He has several properties, two listed (10 unit and 24 unit) and several not yet listed (44 unit and several 4/6 unit). The realtor is sending me additional information on all the assets he is liquidating this week so I have a full inventory shortly.

Here is a link to the city-stats. I know this town- born and raised here so Im familiar with the demographics. http://www.city-data.com/city/Bedford-Indiana.html

Details on the two listed properties (additional property information coming this week):

Bedford, IN

Great Opportunity! 5 Duplexes (10 units)! 6-2BD/1BA and 4-1BD/1BA apartments. Well maintained and great rental history. Multi Family with a 8.5% cap rate and great NOI. This complex can be purchased individually and will also be listed in a portfolio.

$477,900-

5 Duplex (10 Units)

(6) 2bd/1bth (est. rent $750)

(4) 1bd/1bth (est rent $500)

Price: $29,875/bedroom (16 bedrooms)

8.5% cap rate

Shoals, IN

Great Investment. 24 all brick units in Shoals- Martin County. This property offers a 8.5% cap rate and great NOI. 16- 1BD/1BA and 8- 2BD/1BA. Tenants pay their own electric and owner pays water (tenants pay a flat fee monthly to cover). Common Laundry room and playground. Showings are available with a 24 hour notice. This property is offered individually and will be offered in a portfolio with 2 other apartment complexes as well.

$889,700

24 unit

(16) 1bd/1bth (est rent $450)

(8) 2bd/1bth (est rent $700)

Price: $27,781/bedroom (32 bedrooms)

8.5% cap

@Greg- great points. Thank you for the tips!