All Forum Posts by: Erik Hitzelberger

Like you, I'm a fan of Hillview.  I also like everything between there and J-Town (Okolona, Highview, Ferncreek, etc).  You can get homes at entry level price points in good neighborhoods, with good schools, that rent well and have long-term value.  Lyndon is also affordable.  Clifton and Germantown aren't too bad, but the homes are older and the neighborhoods transition quickly.  You want to make sure to know the area before going there.  I have invested in Shepherdsville (Lakes of Dogwood area) and know several Mt. Washington investors.  In Shepherdsville, watch out for the flood plain areas.  

All of that being said, I particularly like student rentals and currently focus my efforts on buying props around U of L.   

What's your goal?  Are you looking for cash flow, appreciation, or some combination?  What type of tenant do you want?  Section 8?  Blue collar? White Collar?  Students?  There are areas that support almost every combination.

@Account Closed   Make the offer subject to whatever conditions you need to have satisfied in order to move forward.  Once it is accepted, YOU control the deal.  Until then, you risk spending a lot of time and energy and having the owner sell to someone else.  

It has been 11 days since your original post. I imagine you've spent a lot of time thinking about this and running numbers. Being in limbo is the worst possible situation. You need to either decide not to buy it or take action towards getting it done. Whether you move forward in your search for a new deal or with this one, you are making progress towards your goal. Standing still because you are stressed out about windows or you are trying to think of yet another way to analyze the deal moves you in the wrong direction. You can paralyze yourself with fear to the point you give up on REI altogether. Don't let this happen.

Time is money! While cliche, this statement is absolutely true when investing in real estate and, doubly so if you are investing on a part-time basis. So how can you make sure that you are not overspending your time and money when flipping houses? Having good systems is critical.

One of the more important documents you need is Property Repair Estimate Sheet. This document should include a list of all of the major items (roof, hvac, kitchen, paint, flooring...) as well as cost estimates for each item. You should complete one of these during your initial visit of every house you look at. The 2 main benefits of the form are 1) to save you time and 2) to give you confidence to proceed with the deal.

Saving Time

Many rehabbers waste time looking into every dark corner of the house during their initial walk-through. They may spend hours measuring and documenting every detail to come up with the best estimate possible. This can be a tremendous waste of time especially since there is a good chance you won't even get the house. Click here to see our list of houses not to buy.

With a good Property Repair Estimate Sheet you should be able to complete your initial inspection in 15-30 minutes. The goal is to get a rough estimate (within $5,000) so that you can make an offer. Simply checking whether the repair is needed and including the corresponding amounts will allow you to total the necessary costs in a few short minutes. Anything beyond that is a waste of time.

Providing Confidence

Having a list of what actually needs to be done to the property will give you confidence that you aren't overlooking anything. By referring to your list, you will make sure that no major items are missed. It is easy to be distracted by something odd in a house and forget to check out every other area. By referring to your Property Repair Estimate Sheet, you can be confident that you have reasonably captured all items. The cost of overlooking a missing air-conditioner, damaged roof or cracked foundation is way too high to rely on your memory.

Systems

Having a system will not only make these 2 goals more attainable, but will also remind you that you are running a business and trying to earn a profit. If you have a tried and true system in place, steps that you follow for every rehab, then you will not spend unnecessary time on issues and will have a turn-key process. It will mean every rehab is done consistently. Also with a system in place it will help to build your confidence that you haven’t overlooked any repairs. You will know how much a kitchen over haul costs so when a contractor over bids you have the confidence to speak up about it. Remember, knowledge is power.

The essential thing to remember is that systems work. Having good systems in place will make sure everything is done in the most financially sound and cost-efficient way. In the end, systems are what will save part-time real estate investors time and money by preventing costly mistakes.

Why wait? Contact us today to get your free copy of our Property Repair Estimate Sheet!

To learn more about Part-Time REI visit us at http://part-timerei.com/

Talk to your local investor-friendly, real estate attorney. Ask about the mechanics of a quit-claim deed to transfer the property to your LLC. Also have him/her explain the risks of 1) the due on sale clause in your mortgage and 2) the liability associated if you leave the property in your name. This conversation will take 5-10 minutes and you will have a clear answer at the end.

I don't have a picture, but in the spirit of your deck photo, I looked at a house several years ago where the owned pour a concrete pad over the entire back yard (0.15 acres)  They had an AG pool in the center and this 2 story castle like structure around with complete with a wooden walk-way from one side of the 'yard' to the other.  I lost the deal because it took me too long to figure out how much it would cost to break it all up.  

You should really have a long sit-down with your wife.  She should know that water is not an effective weapon against zombies.  You need to correct this opinion before it's too late.  It is much more feasible that this was holy water being stored to fend off vampires.  That faint odor was probably a little garlic mixed in for good measure. 

@Shariyf Grevious 

Lol - If you are going to call me out, I have to admit that I got lazy over the last 18 months or so because it was so easy to find deals on the MLS. It seems the low-hanging fruit is now gone and it's time to get back to work though. When I was doing mailings, I was doing a deal or so a month with absentee owners. I think I did 3 in the first 1000 letters.

I don't know the answer to this question for your area.  However, MF (especially large MF) is waaaaaaaaaaaaay different than SF.  I'd say your partner doesn't have any experience either.  I know some guys who did very well starting out in MF, so I'm not saying it can't be done, but make sure you know what you are getting into.  It's easy to get out of a SF deal.  It takes a little more effort to find someone to take over a mess of a MF (without taking an even bigger loss). 

I have and will flip 2BRs also.  They make great homes for single people and younger couples.  You are already pregnant on this one, but here's a tip for the future.  Have your agent check sales for the last 6-12 months by neighborhood or zip code (whichever is most relevant).  Look at the percentage of sales that are 2BR.  In my area, most zip codes are less than 3%.  However, in 3-4 locations 2BR sales run 15-25% of the market.  Use this along with DOM to decide whether to buy.