All Forum Posts by: James Heller

Hi Alicia — This does come up a fair amount, and valuing land itself can be a challenge (let alone if there is a structure that needs to be demo’d). Generally for land — as a super rough rule of thumb I would aim for 20% of what a brand new home would sell for. IE if you find a comp that is brand new and beautiful at $500k in the area, you’d want the land to be around $100k. I may not even figure the demo cost into it, because there are some benefits to having a pre-existing structure (vs completely bare land). 

At the end of the day, ask an agent in the area who works with developers to zero in on a more accurate price. But this can help get you in the right ballpark

Hi Chandler -- The ability to source deals is incredibly important for anybody getting started in real estate. Whether you find them off market or on, and whether you do the rehab work yourself or sell the opportunity to somebody else determines whether you are an "agent" or a "rehabber" or a "wholesaler".

I've found that wholesale can be an effective way to build up capital while looking for your own projects to rehab or renovate. You might dig something up that costs a million dollars up front (which you don't have) -- But it may still be a fantastic deal! And -- The seller may still really need to offload that property and not want to do so on the traditional market.

I am dealing with a case where the property was subject to methamphetamine contamination through no fault of the owner's. They are unable to sell on the MLS, but have no experience in contracting work. This is a perfect case where we can connect them with the right people and hopefully put a smile on everybody's face.

Work on sourcing deals! If you are able to do that, deciding what to do with them is the fun part.

Hey Jeff — I do a lot of the same thing, also working in Denver. I’ve found Batchskip to be very accurate. We have a fairly high contact rate on D4D properties vs our other lists that are generated based on certain criteria. 

I will say it feels like we get a lot more “no’s” on D4D data however, which is strange and could just have to do with the areas that we’ve chosen. Every no is another step toward a yes, so we celebrate those as well ;)

My team is in Bangladesh, they do an absolutely fantastic job and are very well spoken. I pay them $6.25/hr. 

That strikes me as approximately the average, although I have seen some go as low as $4 or so. Go with someone who has excellent communication, strong English speaking skills and prior experience if possible. I monitor through Mojo which is my calling software, and they use HubStaff on their end which sends daily reports. 

If you are getting serious and would like to give them a shot, I’d be happy to refer you

James

Batchskip all day. I’ve used several others, including free services when I was starting out. Saving $10 to miss out on proper data that leads you to a $40k deal is not worth it. 

Use code TTP for a discount!

I've had some tremendous success recently in the Colorado wholesale market, almost exclusively from cold calling. I was able to bring on a larger team towards the end of 2021, and we've brought in several deals above $40,000 which has far exceeded what I thought was possible.

Are you finding that cold calling is working for your business? What other tactics are you finding success with?

I would also like to begin closing on some of these properties we dig up (smaller MFH), if you are searching for the same and have contracting experience (huge plus!) I would love to talk.

Hi Leonard — I work exclusively in CO, here we do not need to have anything notarized. The form goes directly to your title company and explains what the end buyer is paying, your assignment fee, and all of the legal stuff that shows they are assuming your contract. 

I also collect a $10k non refundable deposit (or $20k for higher end properties) from the end buyer when the assignment form is completed. If you do this quickly, that can actually serve as your earnest money on the primary contract! Good luck out there

I use a bit of a rough rule-of-thumb type of measurement. This doesn't always get you to the dollar, but it definitely puts you in the right ballpark. 

You see square footage along the top, and then the following definitions

- Light -- Needs lipstick. Basically paint, carpet, a little clean-up

- Average -- This is cosmetics including flooring, cabinets, maybe a light bathroom/kitchen update, etc

- Heavy -- Gut the place. Everything is beat up, just about every surface will need an update

Add in for big items like a roof (this can easily be estimated based on square footage), appliances, foundation work, etc.

Use this as an estimate for your deals, but always make sure to get a good inspection or a contractor through your space to really dial in the numbers.

This is a pretty amazing post. This really bridges the gap between STRs which investors love but neighbors hate, and long-term rentals which are difficult to turn profits on in CO right now. I think mid-term rentals are often overlooked as an additional revenue stream where STRs are getting banned left and right

I know there are companies that offer AirBNB property management, and will even do all of the setup and furniture finding and such. I have to assume there are similar (or maybe the same) companies that would do this for medium-term rentals? What are they charging to this this type of work? I'm used to a long-term PM charging around 10% for full service management.

Hi @Adam Berlinberg -- That's a great situation to be in. Often times in real estate (and other business ventures), there more risk you take on and time you put in, the higher the return will be. There is certainly a spectrum

A low time/risk investment is going to be something like a REIT, a turnkey rental with a property manager, or a syndication if you can find one.

A higher time/risk investment would be a fix and flip or a fix and hold. These opportunities are more abundant in CO right now if you know where to look. If you have the time, I would recommend looking at something like a duplex that needs some work, adding value to the property and creating a strong rental property. At that point it could be managed by a PM. It would take some upfront work, but become easier over time.

You can always team up with somebody! You bring cash and they bring time, that can be a winning combination. Let me know if you're looking into off-market properties, we do come across some great opportunities!