All Forum Posts by: Drew Friestedt

Skunk gear picture...

[UPDATE] image not coming in for some reason. Might be too large....

The following:

- we had 2 skunks die under a building.
- we had to evict a tenant who spoke no english, smoked about 4 packs a day, and could not make decisions for himself
- had the former owner of a building claim to own it after I was the legal owner at auction and stole about 4 months of rent.
- bed bugs
- I could go on and on... The stories are endless. we video and audio record most. they are really funny!

we deal with this all the time and here is how I learned the system...

I got the subject property under contract and went to the building department in person. I pretended like I was an idiot and asked about 100 questions. I went to every department - new contraction, plumbing, electrical, conservation, etc.... and asked every question imaginable. Then I went to the court house and did the same thing - this property was in demo court. I wasted countless hours figuring this stuff out, but now I'm a pro. To this day, I personally go to the building department to ask questions. I also have the phone numbers of all the relevant inspectors and call them at 6:30 in the morning when I have questions.

Unless someone on here has specific experience in your county and can give you a detailed answer, I recommend you dig deep yourself.

answer depends on the area. we face this all the time in chicago and deal with it by selling properties as is with no warranty on work. But, it a pain in chicago fixing stuff like this. We face this a lot with illegally enclosed porches. Can take 6 to 8 weeks to fix. So the killer is time to resolve.

This question seems to come up a lot, so we made a small video on how we do it. http://youtu.be/oDs6uIPSOJs

We've renovated and sold close to 2000 units this way.

Field guy does the inspection and my partner and I will be dealing w. the owner / lawyer. We expect resistance.

This is the typical defendant w/ poor english and chop shop lawyer. Same old story. Owner won't cut a deal, need to speak w/ attorney. Illinois is a judicial state and it can be VERY difficult to get sales approved and owners / tenants evicted. 10% are tough, 5% are really tough. We have tricks to deal w/ both though.

yep - the risk of buying at auction. There is a 10% chance it will take us 9mo to get control. At the end of the day pricing a property at auction is like pricing an option. Many different things can happen, you need to set a price based on the probability of various outcomes.

Some deals are winner and some are losers. We just finished litigating a home purchase and lost - took 9 months and cost 10K.

Also, from experience on a gut rehab (which this house is not) we can tell you within 10K what a project will cost by looking from the outside in 5 minutes. We've done thousands of units and just know what stuff costs. We GC all our projects and run a crew of labors 20 to 30 deep. We track every dollar spend on labor and materials. We have a great cost database. So, we are pretty good at estimating what things will cost.

good question... I'm just so use to the auction world - we really don't need to see the inside of a house to know what we need to spend. But, to answer your question we spoke with the owner before the auction and looked in through the front door. We also took exterior pictures.

Bottom line is we know within 10% what we will spent. You can do a lot of digging to figure out the condition of a property - we called previous listing brokers, spoke with the neighbors, talked to the owner... you can tell a lot about the inside of a property by looking through windows.... etc.. So you are right. We could spend 35K or 15K, but it won't be 75K.

SFH 5BR.4.1BA in a great area - renovated and expanded in 2000 - Buy for $355,000, worth $575,000, putting $25K into it! Have not see the inside yet. Last one we did in this area was good! made 69K net net net in 103 days - was a 20% return on cost. And these returns do NOT add back commissions - they are net of commissions, carry, etc..

We expect this new one to be even better.

It has hair - defendant represented by a chop shop law firm, so they will extort us - but we planned for it. We have a good video of this one. We'll post it in the coming days if people want to see it.