All Forum Posts by: David Schulwitz

@Keith Jourdan - As both a fan of Detroit and the BRRRR strategy....awesome job!! Those photos look great and you can see the value you added to the place.

I was born and raised in Saginaw - huge Detroit sports fan still today. Move all around the US the last 13 years, but I've settled in DFW, Texas (for now). Just submitted my first offer for a BRRRR property about 6 hours ago, so hopefully I find out tomorrow if my bid won it.

Any advice or mistakes that you made the first time around doing BRRRR? I'll be using a HML because I don't have quite enough capital at the moment to go all cash.

Anyways - great job!  I think I agree with above - maybe try to raise the rent slightly if you're being flooded with calls?  

Dave

Judson, 

Have you listened to the BP podcasts relating to out of state investing?  There are a couple of really good ones that you'll for sure want to look up if you haven't already.  Out of state investing is tough but totally achievable.  

If I were in your shoes, I'd start with looking at Price/Rent ratios across the US, the state's property tax %'s, and where jobs are leaving and coming to.  Lots of ways to skin this cat though...  You're definitely going to want to make sure there is a property manager there that you can trust too.  

Good Luck, 

Dave

Hello BP, 

Considering making an offer on this property for a flip. The area has great schools and a warm market, so I'm feeling conservative and confident regarding the ARV. I would be using a Hard Money Lender to do the deal - they loan 70% of ARV at 14% and 2 points, $275 appraisal fee. These are NOT wrapped into the loan. If I get my offer accepted, I have a 3 day option period to get my GC in there to make a more formal estimate of repairs. As of now I have toured the property, and explained the scope of the project to him over the phone, as well as sent him photos, etc.

This place is a total mess on the inside.  It is a full gut job.  The exterior brick is in good shape, but other than that, there will need to be repairs/rehab done to the roof, foundation, floors, walls, etc etc.  Some of the Air Conditioning system might be able to be used, but I'm sure a lot of HVAC will need to be rehabbed as well.  Because of how extensive this project is, I've allotted $30/sq ft, which comes out to just over $71,000 in renovation costs.  My GC thinks he can get it to a great retail finish with 55-65k, but I'm trying to be conservative by saying 71k.  

Related question for more experienced flippers:  What do you usually end up spending on utility bills while the rehab is happening?  I was going to say $300 a month for all utilities...but that was just a rough estimate.  

The deal --> https://www.biggerpockets.com/calculators/shared/105390/8799483b-e188-484b-888a-0c92a9ee3556

Thank you ahead of time for your honest opinion and happy investing.  

Dave

Hello BP, 

I've used the BP BRRRR calculator quite a bit the last week and am getting comfortable with it, but I've used the Fix and Flip calculator less. When using the BRRRR calculator, there is an entire section for the initial acquisition and rehab financing. I'll be using a hard money lender, so you can very easily put in your HML's points, interest rate, whether or not to wrap these into the loan, their extra fees, etc etc.

With the pure Fix and Flip calculator, there seems to be a lot less inputs available for this. It asks for your closing costs and costs to hold the property each month, but not the same level of financing inputs that the BRRRR calc includes. Also, on the final report next to the ROI figures it says that this is "based on no loans or leverage".

I've just been inputting the same closing costs and monthly holding costs that the BRRRR calculator helped me figure out, but I was a little surprised to see less of a hard money loan section on the Fix and Flip calculator. Am I missing something or no?

I'm a rookie at this so I apologize if I'm missing something obvious.  

Thank you!

Dave

I'm sure some Dayton people will chime in and provide great advice, but as an Air Force veteran, I can tell you the base there employs and brings in thousands of people every year, and with them being there for a short period of time and earning a decent salary, they make fantastic tenants.  If you end up getting a property/properties there, see if they still have the webpage "AHRN" - From what I remember it was a website set up specifically to list rental properties for military folks living in the area.  

Good luck!

Dave

Here's my analysis:  

https://www.biggerpockets.com/calculators/shared/105390/ef44ebf2-e907-4249-8e69-4d982c745614

Thank you!

Dave

Hey BPers, 

I'm increasing my BRRRR deal analysis as prospective deals come across my desk and I'm trying to sort of streamline/systemize things to analyze deals faster. Trying to take Brandon Turner's advice by analyzing AT LEAST 1 deal per day, hopefully more. Anyways, I'm a rookie and I've got some questions that are probably silly but I'd truly appreciate some experienced BRRRR folks help:

Question 1: On page 2 (purchase info) of the BRRRR calculator, it asks for "purchase closing costs" - the help pop up talks about how it's typically $1500-$2500, Brandon puts in $3000 while analyzing a deal on a YouTube video, and I'm trying to understand/figure out what I should be putting in this box. To be honest I'm not sure what these fees would be?? I understand that my hard money lender is going to have his/her fees and points, but those go in the next section below... What purchase closing cost fees am I accounting for here?

Question 2: Estimate Repair cost: Let me start out by saying that I'm reading J Scott's books (haven't finished yet), watching BP videos, etc etc; I know repair costs are going to vary GREATLY by area, contractor, property, and so much more.  With that being said, do you all out there use any sort of 'back of the napkin' estimates before you've gotten your contractor over there to see the property in person?  By going through photos, in my mind I sort of initially judge the properties based on the following 5 categories - 

I'm not asking for a definite answer here, because again these are all going to vary greatly, but I'm curious what other people are using for their quick 'back of the napkin' per/sq ft estimated repair costs to compare...  Am I way off?  How do you all do your quick numbers here?

Question 3: Monthly Insurance on Fixed Landlord expenses:  

- What do you all do here?  Throw the same number down every time?  Actually call up an insurance person or take the time to get a quote?  Do some sort of a quick calculation?  I thought Sq Ft of the property multiplied by .05 might be a decent quick monthly back of the napkin estimate.  So 1700 sq ft home x's .05 would be $85/month.  

I'm sure I'll have more questions later....but most of the other inputs on the calculator I feel decent about.  

Thank you BP!  Happy New Year and happy investing.  Go make yourself a bunch of money :)

Dave

Check this out for basically the same thing but for 2017-2018 --> Found this for 2017-2018 for DFW.  

Thanks for the effort Ashley!!