All Forum Posts by: Hans Christopher Struzyna

Hey Cody, 

It's been good to chat with you over the past week about your investment strategy. As you know, Anything in Alameda County, specifically the Alameda, Oakland, Berkley, are my areas of expertise. As an investor myself, I can speak the language and would be happy to connect with anyone who wants to talk investments. 

Hi @Lenny B. I am extremely active in the Oakland market and would like to chime in here. The Bay Area and specifically the East Bay market has a culture where sellers are expected to disclose everything they can (both from their knowledge as well as hired 3rd party inspectors) up front and buyers are expected to bake all the known material facts about the condition, desirability and the like into their offer price. Also, all the information that is disclosed is typically considered to be off the table as a negotiation point later. The only thing you will be able to negotiate is "new and substantive" findings/disclosures. This is all predicated upon the reputation and reliability of the inspector so make sure you consult with your agent about that. 

As far as putting together a competitive offer, the first question I would ask you is do you have a sense of how many bidders there are? Based on the way you describe the house, it is likely to attract all-cash buyers.  Your agent should be able to tell you exactly how many people will be bidding, who is representing those buyers (and what that persons track record or writing offers is) and what price the property will likely close to given its condition. 

It is typical that sellers of fixers like this will not do a home inspection as they assume that someone will come in and gut it. Also, if the termite report is from anyone other than Omega, you need to dig into their reputation and track record. If your agent is active in this market, they should be able to tell you that quickly. Also, is there anything in the TDS or SPQ (or the termite report) that makes you think the foundation is in bad shape? 

Here is my unsolicited advice: Call David Teare (https://www.bpginspections.com/inspector/406) or Brendt Mullan (https://www.bpginspections.com/inspector/949) at Buyers Protection Group and ask them to come and do a walkthrough with you before you submit the offer. These guys are simply the best inspectors in the East Bay and every good agent knows them. They will charge $200 for the walkthrough. They will walk through, under, and around the house with you and point out everything they see. If they give the seal of approval, you should feel confident in not needing to inspect any further. If they say get something else inspected, do it. 

I hope this helps. Please feel free to reach out should you need anything else. 

Hey all, 

My fiance and I own a duplex in Tacoma Wa. We just finished our final renovation and are getting our second tenant in there now. We have started to talk with a lender who works with a bunch of other investors in the area. She is telling us that for a refi on a non-owner occupied multi-family like this, we will only be able to do 70% LTV and around 5.5%. Does anyone know of a way to get closer to an 80% LTV?

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Tacoma.

Purchase price: $245,000
Cash invested: $105,000

Contributors:
Kristin Hedstrom

My fiance Kristin and I got our long term buy and hold game started last summer. We bought a duplex in Tacoma, WA and have now managed two renovations from CA. It has been a wild ride but we are sure glad we did it.

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

Long term appreciation and cash flow from day 1.

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

It was sitting on the MLS for over 9 months. We ran it through our spreadsheet and the numbers worked. We ended up running over 35 properties through before we got to this one.

How did you finance this deal?

25% down 30 year fixed mortgage.

How did you add value to the deal?

We started off with one vacant unit and one occupied. We fixed up the vacant one with new flooring, paint, lights, heaters, countertops and a few appliances. Then we got a renter paying close to fair market rent. We didn't do a full reno because we were short on cash so we are likely leaving a few bucks behind on rent. Then our 2nd unit became vacant at the end of January and we did a full reno on that unit - kitchen, bathroom, floor, paint, lights, etc.

What was the outcome?

We are just now finishing up the reno on the 2nd unit and will have it leased shortly. It will start to cash flow really well once we do that. $200+ per door.

Lessons learned? Challenges?

Our main challenge was around the property manager we used. Their communication is low and their solution to almost everything is to spend money. As well, the tenant we inherited asked for 30 more days to move out 36 hours before their moveout time and after they had been given proper notice. We ended up negotiating a "cash for keys" deal which in the end was much cheaper than an eviction attorney.

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

Aaron Nelson at White Coat Reality helped us buy it. We have referred a few others to him. He did a great job for us.

Thanks for the comment @Hai G. Id be happy to connect. Shoot me a DM and we can talk when you are available. 

Best,

Hans

Investment Info:

Single-family residence fix & flip investment in Hayward.

Purchase price: $486,000
Cash invested: $86,000
Sale price: $700,000

This was my first flip investment. I found the property, negotiated the purchase, found the lender/investors, managed the GC and managed the re-sale. As a matter of fact, I found it for an investor (as his agent) who ended up pulling out of the deal and assigned it to me. What a learning curve!

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

I was looking for flip/wholesale opportunities on the side of my real estate agent business. Once I ran the numbers on this, I realized it had a good margin and I felt like it was a "safe" first deal.

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

I found it through a cold call and then tons (6 months) of follow up. I negotiated directly with the sellers. They kept saying they wanted over 530k and I didn't think the numbers would work at that amount. I reverse engineered their numbers and found out they didn't even need to go be above $490 to get to their desired net. Always begin with the end in mind.

How did you finance this deal?

Hard money and some private money investors. The private money was an 80/80 loan. 80% of the purchase price and 80% of the rehab over several draws. I had one partner how helped with downpayment and holding costs and two investors who got a fixed return on their cash. My partner and I ended up writing a lot of checks during the hold process.

How did you add value to the deal?

We demoed and redid the bathrooms and kitchen, knocked out a few walls, replaced all the windows, all new floors, new lighting and electrical, paint, roof, etc.

What was the outcome?

The place sold at my desired number and I ended up making the profit margin I wanted.

Lessons learned? Challenges?

Message me and I'll tell you a few stories. :)

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

I am also a real estate agent so I would recommend myself. Most of the other people I used on this deal I would never use again (escrow/title when I bought it, hard money lender, contractor, stager, etc). I have since found much better people and would be happy to share their info should you decide to reach out.

This thread has been very helpful and I appreciate the honest opinions here. I am currently considering joining the M1 program so if anyone has any feedback or opinions they think are important to consider, I openly welcome them. 

Hello BP Salem! My name is Hans Struzyna and I am located in the Bay Area. I have a friend who owns a piece of land in Salem and she wants to develop it. It is .8 acres and has a 3/2 house on it. She wants to add another structure (by potentially subdividing the lot) or potentially adding to what is there currently. Very open to your input. Her goal is have a unit for herself (for retirement) and then rent the rest out. She will also consider selling the whole project though, if the numbers work. She is also in the bay area and is looking for a someone local to partner with. Please reach out directly and I can discuss the specifics and potentially connect you. 

Thanks for your input and have a great day. 

Cheers,

Hans

I have not yet driven for dollars nor have I done my first deal. However, being a business development rep for a commercial real estate firm in San Francisco (ipgsf.com), it is all about "touches". The more quality contacts you make (email, voice mail, handl shakes, etc.) the better. 

Most sales trainers will tell your conversion rate on the first four touches is in the single digits. However, once you get between six and 12 touch's per prospect, your odds of converting nearly quadruple. As well, the majority of sales people will not follow up more than once and less than a third follow up twice. After three, you are in the single digits. 

The best advice I have ever heard on prospecting/ cold calling is "If you can't be first, then be last." - Grant Cardone 

Perstence and numbers are key in this game. If you can have a lot of quality touches, you will succed. 

Does anyone know if there are any types of loans that an LLC is exempt from getting (FHA for example) or something exclusive that an LLC can get that an individual cannot?