All Forum Posts by: Hannah Hammond

@Shiloh Lundahl

Shiloh, not yet, I am still building my network. My business partner comes back in 3 weeks so I have that time to continue building relationships before we hit the ground running.

@Account Closed

By Repositioning I mean value play. Adding value by increasing rents, etc in order to increase income and therefore increase the value of the property. Essentially a "Fix & Flip" with an apartment complex rather than a single family home.

Hey BP!

For those of you who have experience with repositioning apartment complexes, what have you found to be the average cost per door or sq/ft to update each unit (new paint, floors, maybe counters) in a B to C+ area? I know this number can very greatly but a ball park number that's typical to shoot for will help. Also, do you typically hire sub contractors to do the work or a GC? Any input would be awesome, thank you! 

Hannah Hammond

Hello BP! 

My business partner and I have a goal this year to purchase an apartment complex for reposition and sale, and we're planning on utilizing private equity lenders as well as a credit partner in order to get this done. I would like to use private equity for the down payment and have a credit partner who will qualify for the commercial loan. I am planning to pay the private equity lenders a simple annual interest, but am not sure what is common for credit partners. For example a monthly payment plus an equity share in the property? Just an equity share? If so, what percent equity and or monthly payment? 

If anyone is willing to share how they have successfully structured this in the past I would very much appreciate it! 

Thank you! 

@Anthony Dominguez

Hi Anthony, 

For this example, a 20% return would be if I invested a total of $100,000 in a property and sold it for $120,000 (Net). That would be a profit of $20,000 or 20%. Hope that helps!

@Account Closed

Hi Michael! 

Yes I am aware of the golden rule, I was just saying my business plan requires a minimum of 20% return per flip, but I will be aiming for a minimum of 30% return. All depends on how much rehab it needs and how quickly I will be able to turn the property over. 

Those returns are very impressive, congratulations! How are you finding most of your deals? 

Thank you so much!

Hannah

Thank you so much everyone for your great input, it is very much appreciated! Looks like I'll be sticking to my business plan and staying in Phoenix for now =)

Hi Wendy, Thank you! My business plan requires a minimum of 20% profit on any flip. I am a licensed Realtor in Arizona so that will save me an extra 3% on the sale side which is an extra benefit, but I am also considering moving to a different state and I'm curious if others are averaging larger returns elsewhere. 

Hey BP! I live in Phoenix, Arizona am about to start my flipping business in a few months. I'll have $300,000 to work with and was planning on doing my flips here in Phoenix but was wondering if anyone would recommend flipping in cities in other states that would potentially offer a higher return. Just interested in your thoughts, thank you! 

Hi Rohan, 

I am not familiar with Tucson, but I am very familiar with Phoenix and the surrounding cities. Good employment, low crime rates, and high rental markets can be found in many zip codes around Phoenix, Scottsdale, Tempe, and Mesa. 

Scottsdale: I would invest in old town Scottsdale, a bit more affordable properties than north Scottsdale with very high rental demand. 85251, 85250, 85257. I have a house in 85251 that always rents within a week for full asking. Just rented this 4 bedroom SFH for 2550 a month for long term tenant

Phoenix: I would stick to east Phoenix to avoid crime. 85018, 85016.... 85008 will have cheaper properties with higher cash flow, some neighborhoods are definitely better than others in this zip code. 

Tempe: ASU and many new corporate offices call for sky rocketing rental demand... can't go wrong with 85281 or 85282. 85281 is closest to Scottsdale/ Phoenix/ ASU/ and the airport. I have a rental property here that never goes more than 5 days without getting rented out for full asking. Just rented 2 bedroom town house for $1350 a month.

Mesa: I don't have any properties here but Mesa is an expanding city with increasing demand and lots of building going on. You will get more house for your money in this city. 85201, 85202, and 85203 are good zip codes to consider. 

Your price range will determine a lot and will allow you to narrow down the zip codes for your search.

I am a Realtor here and have experience with both condos, multi family, as well as single family home rentals, so feel free message/ call me if you have any further questions or would like me to assist you in finding your next property. Hope this helps! =) 

Hannah Hammond