All Forum Posts by: Denny Faircloth

@Josh Bowser - would love to connect and collaborate. We may have crossed paths at a previous PadSplit meetup. I'm an investor, agent and PadSplit host. Have participated in about 6 PadSplit projects over the past year. I'm not here on BP a ton so I'll look you up and send you a text.

@Ali Radoncic - just to clarify... You'd like to see what a PadSplit looks like? Happy to help.

Hey Alex, great question. I can tell you're going to do well. If you're thinking about these things, asking the right questions and taking action, you're light years ahead of most people your age. California isn't ideal because the current migration from the rest of the country to the southeast means low appreciation or even short term depreciation will be an issue. 

However when "House Hacking" you live in the property so you get to use "owner occupied" financing. Which means much better terms. Not to mention you understand your local market. Can easily assemble a team of local agent, lender, contractor, prop manager, etc. You're going to live in it so you will be intimately involved in ever aspect of the process and present every step of the way. So you'll learn a lot getting started and over time. There are tax advantages with your primary residence as well. I could go on, but for all those reasons I'd recommend "House Hacking" to get some experience.

At the risk of sounding like a broken record because I say this all the time... BRRRR + House Hacking = FREEDOM

This is exactly what I'd do if I were a young and single. Use a "primary residence" renovation loan (Homestyle, 203K, ChoiceRenovation, VA or USDA) and buy a fixer upper. Add value through renovations. Move into the house. Rent using friends, family, AirBNB, VRBO, PadSplit or some rental strategy you're comfortable with to pay the mortgage. You won't need to refinance because you've already got a long term mortgage, but if rates come down significantly you'll want to refi to reduce the monthly payment. Now start the process all over again. When you move out, keep the property. If you're renting out rooms, simply rent out your room. If you want to rent the entire home out as an LTR, MTR or STR, take all of your roommates to the next house with you. Repeat this process every year. In 10 years you'll have 10 homes and you'll be 30. In 20 yrs you can sell 1/2 of the homes and pay off the other 1/2. At 40 you now have 10 homes free and clear. Average $3-4K mth rent or more if they're in Cali. That's $30-40K mth, enjoy life!

@Komal Sekhon with prices and interest rates as high as they are, making LTRs work is a challenge to say the least. The #airbnbust is real. Declining rates and demand coupled with excess supply is making the STR business harder than ever. Not to mention AirBNB is catering to local regulations, politicians and the guests these days. The host / investor is getting his / her butt kicked on multiple fronts.

People are selling or converting STRs into MTRs. Now the MTR market is getting crowded quickly. The MTR strategy also requires a little more effort to source tenants. Not a good platform like AirBNB or VRBO to source tenants for you. So it requires more networking, relationships, marketing etc. to find good tenants consistently.

There may be an opportunity in the next few years in the multifamily space. Increased interest rates over the last 2 years and increasing cap rates have put downward pressure on multifamily values. If interest rates come down or cap rates compress or both, that will increase values. Timing that pivot perfectly is a challenge, but might be some opportunities there in 2025.

As an agent and investor myself, the only thing I've found that makes the most sense in today's market in Atlanta is..... PadSplit aka rent by the room aka co-living is the most exciting thing I've seen in real estate in years. The affordable housing challenge is out of control. Millions of people need a safe, clean and affordable place to live. PadSplit is making it possible, even in today's market, for investors to provide much needed workforce housing while making a great ROI. I'm actively converting STRs to PadSplit. As well as buying more properties and helping my investors do the same. They started in Atlanta but are now in dozens of cities across the US and expanding.

When I was introduced to the concept I had tons of thoughts and questions. Happy to answer those for you or anyone else.

 What he said 👆 💯 

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $369,597
Sale price: $475,000

New construction buyer deported due to expired visa. Company failed to file paperwork in time. Builder took 18 months to build the home so the value had increased significantly. Lender won't lend money to buyer in another country with expired visa and no job. Buyer was going to lose the home and earnest money. Agent doesn't get commission after working with buyer for 2 years. Builder wanted to cancel the contract and find a new buyer at current market prices which were 20-30% higher.

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

I could make the buyer whole and help the agent get paid while taking advantage of the rapidly increasing market.

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

The agent posted in my Facebook group that she needed an investor or hard money lender, so I called her and ask for details. Then solved the problem with a little creativity.

How did you finance this deal?

Cash from a private lender, so I used $0 of my own money. Made the lender a 50/50 equity partner on the deal.

How did you add value to the deal?

The contract was not assignable and builder wouldn't let the buyer change any of the terms of the agreement. We gave the buyer a 0% hard money loan collateralized by the property in under 48 hrs. With some pretty steep penalties if it wasn't paid off in under 2 weeks. The buyer was able to close. The agent got paid. The buyer sold us the home for the full price + some transaction cost, so he got his earnest money back and paid us back with our money. We got the property.

What was the outcome?

I ultimately sold the property for $105K more than I paid for it.

Lessons learned? Challenges?

The builder hadn't completely finished the property but they were forcing buyers to close before the end of the year. So it was challenging getting the builder to do the punch list with urgency since they had been paid. Some teenagers also broke in and vandalized some things which exacerbated the problem. The builder was ultimately responsible until they delivered the finished product. Then we had to wait 90 days post close to accept an FHA buyer, so it took about 5 months to get SOLD.

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

I'm a realtor and investor so I brought all the experience and knowledge, but couldn't have moved so quickly without my private lender, who wired all the funds in under 48 hrs with now contract in place. It pays to build relationships.

 Blake is awesome, priceless resource in the PadSplit world.

Hi @Joseph Michael, I'm an investor and my wife is an agent. Feel free to check out my profile for my background and experience, but we'd be glad to help you with your real estate needs in Atlanta. Should probably start with an introductory / exploratory call. Text or call me to get something scheduled. Contact info is in my signature or on my profile. I'd be glad to connect you with a lender or any other real estate professional in the Atlanta area needed to make this process a smooth as possible. If you no longer require assistance, no worries. Best wishes!

 Awesome to connect here as well. Shoot me a text and let’s grab a coffee since we’re both here in ATL. Hoping to serve at Souly in August bc my wife is due in Oct so I definitely won’t make that one. 

20% Discount for Bigger Pockets members. Use code "BP at checkout.

❓ Have you tried real estate but struggled to make it work?❓

Join us for a full-day of Rehabbing Real Estate Reality in a Live On-Site Bootcamp Event!

Get the ultimate Real Estate Blueprint to Earning Millions Flipping Houses

Here are some of The Investor’s Blueprint specs you can expect:

✅ How to find deals in todays market.

✅ Write offers that kill and almost guarantee you’ll make money…or it isn’t a deal.

✅ How to flip houses if you don’t have any money.

✅ Design to sell and estimate rehab cost like a licensed contractor….even if you don’t know anything about construction.

✅ How to build a championship team so you can win the real estate game.

✅ Marketing made simple so your house gets flipped quick.

Sign up today to reserve your seat for August 18th before the limited seating is gone!

Register HERE and use DISCOUNT CODE "BP" for a 20% discount off of admission.

Anyone who has attended one of our Bootcamps in the past will tell you that it is a potentially life-changing experience. wholesaling or rehabbing properties and managing contractors is a fast game. Few investors have the perseverance to succeed in the rehab business, because the game is hard to master. Mistakes on the job can cause you to lose your shirt or worse yet have your shirt ripped off your back. The scope of knowledge you must possess to complete a profitable rehab is very large…it’s these new systems and strategies that we will be sharing with everyone who joins us at the event!

• On site live bus tour
• The latest marketing techniques and online strategies to get all the deals you will ever need to Rehab or Wholesale
• Learn how to screen and hire contractors
• How to Formulate A Scope of Work
• How to Formulate A Payment Schedule to keep every job on track
• Step by Step breakdown of the Rehabbing Process
• Learn the skills and techniques that will make you the most valuable Wholesaler in your market.
• Learn the techniques to estimate renovation costs accurately and efficiently so your numbers are spot on.

Register HERE and use DISCOUNT CODE "BP" for a 20% discount off of admission.