All Forum Posts by: Francis J Carey

Mahalo,

The outcome was definitely worth the effort! 

Investment Info:

Condo buy & hold investment.

Purchase price: $330,000
Cash invested: $60,000

We were managing this unit as a vacation rental when the owner decided to sell. We used our savings to get the property at a price of $330,000 in November of 2021. Similar units in the complex are now selling for $425,000 - $440,000 . We list this unit on Airbnb and run at about 90% occupancy. This unit clears close to $2000 monthly after expenses including HOA fee. We are currently saving most of the proceeds in order to acquire another vacation rental.

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

My wife and I started a property management business during the pandemic. The owner of this unit decided to sell so we pooled our savings and we were able to get the deal done.

How did you add value to the deal?

We added a brand new sleeper sofa (no easy task on Kauai lol) , all new lamps, end tables etc. also added a brand new King size bed.

What was the outcome?

The unit has been a complete success for us and we really enjoy providing a fantastic island experience.

Lessons learned? Challenges?

We learned so much as far as the complexities of Hawaii's transient accommodations tax, zoning and Airbnb hosting. We manage another six units and now have close to three hundred 5 star reviews.

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

My wife Jennifer Carey is a talented and long time realtor. We are experienced in hosting here on Kauai for many mainland owners who wish to own a piece of paradise and make some money when they're not on island.

Investment Info:

Single-family residence fix & flip investment in Kapaa.

Purchase price: $600,000
Cash invested: $300,000
Sale price: $1,479,000

In a three way partnership with a hard money lender in Florida we acquired this 4 bedroom 2700 square foot home on the island of Kauai. The home was distressed and the owners were motivated. After over 5 months of renovations we successfully sold the property to a local family/business owner.

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

We had been searching for a property to flip and came across this opportunity by sending post cards to listed owners of distressed properties. The owner called our number and we were able to construct a deal that was beneficial to both sides.

How did you finance this deal?

We used a hard money lender for both the purchase price and renovations. The hard money lender went in as a partner so the hard money costs were covered by the proceeds of the sale.

How did you add value to the deal?

Adding value was a 5 month journey and a complete renovation. Our renovation costs ended up around $300,000.

What was the outcome?

The outcome was approximately $100.000 per partner and a happy new home owner/family. This was our first flip and we feel blessed to have had the opportunity to help an owner

Lessons learned? Challenges?

We learned quite a bit about hard money lending, coordination and relationships with multiple local contractors. The entire project was a challenge but after all the blood, sweat and tears the deal produced what we'd hoped it would. Another lesson learned was that even in a high price area like Kauai a deal was possible. We just had to dig hard and work hard.

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

My wife Jennifer Carey, a realtor with Waioli Properties in Lihue HI, made the initial contact with the owners and fostered a fantastic rapport with them. Jennifer's knowledge of the local market and vast experience in property valuation was vital to this deal. Jennifer has over 13 years in providing broker price opinions and over 20 years listing and selling properties in NY, CA and the last 10 years on Kauai.