All Forum Posts by: Gary Parilis

@Tri Le Did you find someone? How'd it go? I'm looking for a contractor in Columbus now for a duplex I just bought. If yours went well, can you share a name? Thanks!

Anybody have contractors you'd recommend in Columbus? We've got a significant rehab to do. Got one quote so far in which some items seem high. Of course quality, speed, and reliability are critical, not just price. We're out of state, so managing multiple parties would be a challenge, though we may divide some up.

I'd be grateful for solid referrals. Thanks.

IMO, once you've got your investment out, any positive cash flow is a good BRRRR -- as long as your out estimates are conservative and you have sufficient reserves to deal with unexpected expenses. You own a property with no cash of your own in, and every month your equity grows.

A caveat, though... You generally don't know for certain you'll be getting all your cash out -- you don't know exactly how it will appraise after rehab. If you do your analysis based on a low guess on the ARV and a high guess on expenses, is your CoCR acceptable? If so, you're good.

@Julio Garcia Thanks... Yes, I'm sure those things are true... Hence my question.

I'm eager to know whether others have tried it. If it's been successful, how they made it so, and if it's failed, what were the problems and causes. I don't want to be stupid for the sake of saving a few bucks.

But also -- I don't think we want to manage all of it separately. That would be too hard. But are there certain pieces easier to  contract out ourselves? For instance, I think we can separate the exterior and interior into two buckets, at a minimum.

We just closed on an out-of-state duplex we intend to either BRRRR or flip (depending on how the appraisal turns out). During the inspection period we got a quote from a GC -- much higher than we'd expected but low enough to still go thru with the purchase. He gave us a detailed itemization of the costs, and some items seem much too high. We'll get quotes from other GCs, but we're sure the job would be much less expensive if we hired a bunch of individuals:

- kitchens and baths

- flooring

- exterior repairs, siding, windows, gutters

- interior and exterior doors (these seemed way high)

- trim, paint

- electrical

- plumbing

- appliances

But this would all be very difficult to manage from afar. Have you tried this? How has it worked? What advice do you have? Are there certain pieces that are most likely to cost much less if we go to the source? At a minimum, the exterior repairs, siding, windows, and gutters seem like an obvious choice.

Thanks.

@Thomas Jerome, another spin on what @John Teachout says is: Be as accurate as you can, but also do alternative calcs based on the most pessimistic estimates. If the pessimistic view is acceptable, then move forward.

FWIW, I generally assume the rent is somewhere between the 25th percentile and the median. But make sure to look at the individual comps. Sometimes there is a lot of variance -- and some may be more similar to your property than others.

@Travis Oakes... Congratulations on your purchase and the bold move you're taking! This may be obvious, but make sure to consider whether converting the LR to an extra BR leaves a logical layout to the property. If it becomes "weird", you may get the higher rent, but have a helluva time trying to sell it eventually.

Thanks, @Zeke Liston, of course you do. :-) Yup, that's one of three comps relatively nearby, all of which indicate this is a good deal. Just good to get independent/unbiased confirmation. 

I need local opinions to validate my assumptions on ARV and rent estimate (high-end rehab) on a duplex in Franklinton (3/1 on each side) from folks intimate with the Columbus market. PM me for more details if needed. Thanks!

Interesting situation. I'm not sure you're including all the expenses in your calculation. A $216k loan with no interest is about $600 per month principal payment. If your rent is $1600, your cash flow would be $1000/mo or $12,000/yr if you had no other expenses. What about taxes and insurance? Repairs and maintenance? Are you paying for management or self-managing? How often do you expect tenants to turn over (count on vacancy plus at least paint).

In general, seller financing is a great idea with SDIRA, though, because non-recourse loans have high interest rates, low LTV, and other restrictions.