All Forum Posts by: Jake Roland

Hey, I recently purchased a small 8 lot MHP in Opelika, AL. Everything was run down and vacant and since we have sold off and removed all the old falling apart trailers and cleaned up the property and are close to ready to rent spaces out for hopefully all TOH. We are trying to keep everything TOH for ease of management since it's a small park, but not completely against having a POH or a few to start with. (Open to suggestions for best ways to fill up the park) We have experience in normal residential leases but I need help with some examples of what other people are using for 

- Land leases for just leasing lots for TOH 

- Examples of "park rules" and any other important documents you may be using for running/managing a small park. 

-Do you offer any move-in incentives to get spaces rented out?

-If tenants do their own lawn care, how do you figure out exactly the space the tenant cares for vs "common area" as well as handling fences and pets. 

-Complaint based system for junky yards full of kids toys, or do you have specific rules for those types of things? 

Hey Aiden, let me know how I can help! Shoot me a message. 

Investment Info:

Single-family residence fix & flip investment in Opelika.

Purchase price: $90,000
Cash invested: $52,000
Sale price: $235,000

Bought for $90,000 with a partner and put $52,000 (and a lot of work ourselves) into renovations in 3 months, sold for $235,000. Bought using a private money lender for the purchase price, and split the renovations between me and the partner.

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

The house was in a neighborhood I used to live in, so I knew the comps.

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

On the MLS. Listed for $132,000 and we made a $90,000 no contingencies offer the first day, and after some back and forth they accepted the $90,000. It was an estate sale.

How did you finance this deal?

A private money lender. He has funded several deals so far and he takes a hefty cut, but the cash offer was the only reason we could get the property in the first place so it was worth it!

How did you add value to the deal?

Put $52,000 into renovations and a lot of work ourselves. Tile showers, floors, etc.

Lessons learned? Challenges?

We had it under contract to sale the first day after we listed the flip, but down the road the appraisal came back super low. We wanted to do a rebuttal and argue the appraisal, but buyer didn't want to do that and so they backed out of the deal. We were bummed at first, but we put the house back on the market and had multiple offers and got a great new contract that closed in less than 30 days.

Investment Info:

Single-family residence fix & flip investment in Opelika.

Purchase price: $90,000
Cash invested: $52,000
Sale price: $235,000

Found on the MLS and low balled the first day on market and got it under contract. Bought for $90,000 with a partner and put $52,000 (and a lot of work ourselves) into renovations in 3 months, sold for $235,000. Bought using a private money lender for the purchase price, and split the renovations between me and the partner.

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

Found this deal on the MLS, listed for $132,000. We saw it and visually inspected it the first day on market and put in a no contingencies offer (no inspection, no appraisal, cash) immediately for $90,000. After a little back and forth, the sellers accepted our $90,000 offer and we closed in three weeks. It was an estate sale.

How did you finance this deal?

A private money lender my partner and I have developed a relationship with has funded several deals so far, he takes a hefty cut, but making the offer cash was the only reason we were able to secure the property in the first place.

How did you add value to the deal?

Put $52,000 in renovations and did a good bit of the work ourselves.

Lessons learned? Challenges?

When we were selling it, it went under contract the first day on market, and we got further into the deal and the appraisal came in super low. We tried to do a rebuttal but the buyer didn't want to do that. We were kind of bummed but we ended up putting it back on the market and got multiple offers and got a great deal with a buyer who closed in less than 30 days through the holidays as well. Appraisal came in right on target the second time.

Investment Info:

Single-family residence buy & hold investment in Opelika.

Purchase price: $74,000
Cash invested: $17,500

Live in BRRRR deal. Bought for $74,000 at the end of 2017 put $17,500 into it doing all the labor ourselves. Now worth at least $150,000 and is currently rented for $1250/mo.

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

This was the best way to get started for us. We closed on this house and my wife and I got married the next day, we had to move somewhere so we fixed up the bedroom and moved in. Then redid the rest of the house one room at a time.

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

Found on the MLS. Very bad marketing, it was on the market for over 6 months because photos had tenants in them, property looked worse than it really was in the photos. When we went to see it in person for the first time, tenants had moved out, they had installed a new roof and water heater, and none of that was even mentioned in the listing. It was listed for $99,000 and we offered $70,000, worked our way up to meet at $74,000.

How did you finance this deal?

Private investor funded the front end, and then after repairs we refinanced with a traditional mortgage lender.

How did you add value to the deal?

Rearranged a laundry room to make another full bathroom/laundry combo to make the house a 3/2 instead of a 3/1. Updated kitchen, first bathroom, and flooring and paint throughout.

What was the outcome?

We were able to cash out about $27,000 over our private lender loan amount to get our repairs cost plus some from the BRRRR refinance, and now have at least $30,000 in equity in the property and it cash flows around $550/mo with it rented at $1250/mo.

Lessons learned? Challenges?

It is difficult to live in a space you are also trying to remodel, we had to do basically one room at a time because we moved in right away. But making sacrifices early is how you get ahead!

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

I got my real estate license just a couple of weeks before closing on this property, so I was able to collect the commission on the sale which was also nice because I didn't have a lot of money at the time.

Investment Info:

Single-family residence fix & flip investment in Opelika.

Purchase price: $62,000
Cash invested: $50,000
Sale price: $170,000

Bought as a package deal $82,000 for two houses with seller financing. Put $50,000 into the first one (built in 1930s) and sold it for $170,000 in July 2020. Put $75,000 into the other house (built in 1950s) and it is currently under contract for $185,000 supposed to close Nov 20th 2020. Profit split with partner around $148,000 for both houses.

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

To build capital up for more buy and hold investing.

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

Found this deal through another investor friend. Distressed seller who had a note come due that was more than one of the houses was worth, so I brought in a partner and we purchased two houses from the seller for $82,000 and paid down enough to pay off his note, ($50,000) and the seller financed the rest at 6% interest with interest only payments.

How did you finance this deal?

Large down payment split with partner, seller financing the rest.

How did you add value to the deal?

Added renovations to bring them up to today's standards.

@Kevin Akers A lender is probably better to answer this than me, but in my experience yes you can definitely get a conventional loan on a duplex. If you are going to be living in one side, that opens up your options for down payment quite significantly with low down payment conventional loans or low down payment FHA loans. If you don't plan on living in the duplex, you probably will have to put 10% or more down. Shop around though to different lenders in your area and tell them what you want to do and see who has the best loan product for you.

@Paul Shepherd I'm sure it depends on your area, but in my experience no appraiser or buyer has ever asked to see permits for anything. Or gone to the courthouse to check if something was permitted. If you are adding on sqft it may raise a flag to someone, but just changing within the current structure, and as long as it's done correctly to where an inspector can come in and not find anything drastically wrong with it (toilet too close to the wall, etc) I doubt you would be screwing yourself when you went to sell it. I just did exactly what you're talking about, turned a 3 bed 1 bath into a 3 bed 2 bath within the existing sqft, without permits, it recently appraised for what I expected and counted as a 3/2 and was never asked about permits. That's just my experience though. 

@Kenneth Wiley At least where I'm from, there is a pretty low cost to get in. Around $1,000 to get started, and around $1,000 in yearly fees after that. Most if not all of that can be put on a credit card. Hope that helps. 

@Suzy Sevier I suppose it depends on what class of property you are talking about. In the afforadable homes price range it probably doesn't add any value, at least in my area. On the more expensive properties, something like an outdoor fireplace can add a few thousand. I wouldn't ever add any value to a comp for a normal living area fireplace though in my area.