All Forum Posts by: Doug McLeod

I've used them on 2 jobs and wish I had on at least one other they bid on. . They may not be your lowest bid, but they will be your most complete scope of work and dialogue about what may or may not get you more rent or a higher selling price. They do good work and are very professional. Everything in writing. 

As a buy & hold guy and wanna-try-it flipper, the three things I need most are deals where the numbers work, cash to purchase (hard money is great but puts me at a disadvantage vs cash buyers), and good long term financing.  

I've exhausted my conforming Fannie/Freddie backed loans (10) so the deal numbers must be better than every deal I've done to date to work at commercial/portfolio loan interest rates and shorter amortization periods. 

A friend of mine got a good deal on a package of refurbished appliances at Justified Appliance.  Good warranty, too. 

@Bil Casimir

My mortgage calculator suggests the P&I on that loan (based on info given) would be about $826 - plus your taxes at $338 is $1164. Lets say you can get insurance for $1200/yr for replacement cost coverage (you do intend to get insurance, right?). That puts your monthly expenses (including mortgage) at $1264. Assume another $400/yr for HOA - that's $1294/mo. If you are very aggressive and do only 5% for vacancy, maintenance, and capex - and $0 for management, you would already be at $0 (or slightly negative) cash flow and $30k negative equity. Terrible rental deal.

Can you make it into something by doing owner finance?  Maybe - ask your 5 friends, but seems like the buyer would need to have lots of cash and good income and not be very smart (because he/she could rent or buy a similar house for less all day long).  Put some numbers together that include all the expenses then line that up with a plan/exit strategy that shows you making money that has a high probability of success. Not sure its there.

Tom - let's talk if you like.  281-745-1505. 

Doug

Years built?

What you want is sometimes called a desktop appraisal, but they tend to ignore your specific upgrades also. 

A CMA from a realtor should give you what you want if they can also pull pictures for the comps so you can see what upgrades the comps have (or not) and make some adjustments on that basis.

Also, how much do you want to make on a flip?  You might start with your profit goals and purchasing ability and start looking for deals within an hour (at rush hour) radius of your work since you are otherwise flexible.  

Houston is too spread out to tackle that way with too much similar inventory in almost any direction across price ranges with good neighborhoods. Unless you can afford and want to stay in West U, Bellaire, The Heights, Westchase, etc. you will find lots of commonality in the types of neighborhoods and price points outside the beltway. And there is flip potential from the low 100s up through the 400-600s and higher. 

Assuming you have a job in a fixed location (?), how much of a commute are you willing to take on?  Do you have friends here? Want to be within a reasonable proximity?  What can you afford? How old a property are you willing to deal with? See if you can narrow things down a little. 

Houston is not the best house-hacking city by a long stretch. Generally there are just not that many 2-4 plex properties that are not part of a condo/townhome association. And for the properties in the <130k range, you will be hard pressed to find one you'd want to live in. On the other hand, you can find some decent older homes (late 70's early 80's) that have been nicely remodeled (or need to be) in that price range. There is very little inventory from 1985-1993 or so because of the oil bust and related housing crash in Houston from that time. Deals on properties from 1994 and later are MUCH harder to find. They don't last long if you ever even see them hit the MLS.

Consider buying one of those older homes on a FHA loan with low downpayment or even a 203k to help with repairs if its a fixer upper. Or look for a HUD property - that might give you a better shot at getting a post 1994 house. Often there are fewer buyers during Nov-Jan, so if you're willing to look hard through the holiday periods when others are waiting for after the new year, you can do a little better on price.

If its just the two of you (or even if you have a baby and can manage not to accumulate too much "stuff"), fix it up, live in it for a year (rent out a room if you can - just screen well) and try to save up enough for another downpayment so you can buy another property the next year and keep the prior one as a rental - or if you like your place, just buy the next one as a rental.

The suburbs outside the Beltway or sometimes just inside the Beltway are your best bets for these.  Use HAR.com to find the types of neighborhoods you might consider in the different areas.