All Forum Posts by: Dana LaBerge

@Omar Shazly Yes. Nash county side preferably.

@Lisa Hernandez

I buy anywhere in a 50 mile radius around Raleigh, so if you find anything, let me know as well. I will say that the wholesale market here is incredibly competitive.

I have some investors that I just pay a flat interest rate while their money is being used and they fund the entire project.  If they do fund the entire project, they get a deed of trust (mortgage) on the property in the first position.  Other investors I don't pay any interest, but they get 1/2 of the profit. And some investors get both if they are willing to give me flexibility with their money.  I.e. if they let me use their money combined with a hard money loan with no deed of trust.  Investors that just get a flat interest rate (10-12%) are my preference because they don't care how the money is used (rentals or flips) and they are purely passive.  I also pay the interest payments monthly using direct deposit. 

It all depends on what their goal and yours is.  If they just want some diversification with a consistent return, flat interest is the way to go.  If they want to maximize their return, then do a profit split, usually not more than 50/50.  If you just want to get one under your belt and build investor rapport, you may be willing to pay them more at first to prove the process.  But once you set the expectation with them, it's hard for them to swallow getting less on future projects.  I started out giving a lot to my first investors to build my business (10% interest and profit split), and then less to new investors (flat interest with no profit split).

I think I would make a list of what you anticipate him doing and also what you will be doing now that he handled on the first one, and then discuss what he feels fair compensation would be for the reduced responsibilities.  Then it's just negotiation from there.  For hourly labor jobs, I would have him quote those jobs like any other contractor would.  Then an additional flat fee for any management that he does.  But having the expectations and roles written out clearly and agreed upon up front is the key.

I'm still doing both in the Raleigh-Durham area. For flips, I'm staying below the 200k ARV price point and only doing quick rehabs. Things have still been moving so that's good. I have 5 more to go on the market in the next 2 weeks, so that will be a good test.

I have 3 rooming houses in Durham, all close to NCCU, and haven't had any problems with the city.  My assistant called and told them what we were doing and was able to get the Land Use Permit changed to allow it.  It was done in less than a week...once she was finally able to talk to the right person.  I have a property manager that has struggled to fill them, but we are almost there.  One is a 4 bed/4 bath house which filled much faster.  One is a 10 bed/4 bath house that is half filled.  The other is a 7 bed/4 bath house that will be rented to a non-profit that works with homeless people, specifically women in crisis.  The non-profit will be the master tenant and it will be their responsibility to fill the rooms with the people that they are serving.  My rent won't change even if they have empty rooms.  That will be the plan with the other 2 rooming houses too eventually.

My project manager has had some experience in the historical districts.  My understanding is that if it's a local "Durham" historical district then it's a big pain with most exterior changes needing approval.  But if it's a National Historic district you don't need that approval to make improvements on the property, just if you are going to change the property use, etc.  I have a few over there in the National areas and there is lots of info online with the requirements for what needs approval.  The same for the local districts.

They are there, but definitely tough to find. I have a couple of rooming houses that will do well when they are full, and a duplex that is around 15%. Property and rent appreciation are helpful there though too and the ones that aren't over 10% should be in a year or two with rent increases. I had to stop trying to exclusively find properties with the CoC return that I wanted now, and instead find some that would be there fairly soon if managed well. So time will tell if that strategy is successful or not.

Yeah, I've experienced that too.  I've been able to pick up 7 rentals there this past year and they cash flow, but it's not spectacular.  
I was asking more on the flipping side as I am always looking for areas that have been changing for a couple of years, but that still have some opportunities to get something at a reasonable price.  I flip quite a few in Durham, but still don't feel like I have a good handle on what is happening in the different areas.  I'm still trying to formulate a strategy for targeting areas over there and need to learn more.

Thanks for the follow up.  You too @Keith Amado.

I'm curious @Dave Olverson and @Randy E. and others that contributed, if you were to update your thoughts on Durham 3 years later, what would your thoughts and observations on Durham be now?