All Forum Posts by: Joey Hicks

Consult your attorney. Im not sure how it works but. I am purchasing a triplex in Tennessee . My attorney wants to split it into 3 separate single family dwellings, on paper, before transferring it into my LLC. In Tennessee we don't pay excess and franchise tax on single family.

I'm purchasing my first BRRRR. Close March 26th. It's a duplex that currently rents for 1-2 bedroom $400 and a 1-1 bedroom $450. The 2 bedroom tenant will be moving out this today. All ready have a tenant set to move in next week. Rents will be bumped up to $700. I will be turning the walk out basement into a 3rd unit with 1 bedroom. My plan is to have the current 1 bedroom tenant move to the basement. Then rehab his unit and increase the rent to $500. Giving me a total rent of $1650. I have negotiated in the coin operated washer and dryer that hasn't been installed yet. This will help me recoup some of the water bill I will be paying. After, the refinance I'm looking at $600 in cashflow and 37.5% COC return.

Started my 2nd flip today with my partner. 3 bedroom 1 bath 1000 SQFT adding 200 SQFT addition to make a 3 bedroom 2 bath with open concept. 3 months to complete the project. $20K purchase. $65K rehab. ARV $150k. This is 1 of 4 vacant houses on this street. Trying to make deals on the other 3. It feels good to improve on a neighborhood.

Matt- I use Tri-state Property Inspections 423-559-9495. David has always threated us well. Best of all he will walk the property with you afterwards and show you issues he's found, along with a detailed report with pictures. David will also take his time to talk to you about investing. He is an investor himself. As far as contractors go I have used HJ Construction Contractors 423-665-9188. Disclaimer: Hector who owns HJ is my nephew so I can be biased. I have not used anyone else.  

Hello all what do you think of this deal? Rents are low the current owner has owned the property for 5 years and never raised rents. Tenants are month to month with no lease. This will be owner financing for 1 to 2 years paying $20,000 down with 3% interest. I'll need to refinance by the end of year 2. Current rents are $450 and $400.  I can raise rents to $650 and $600. I'll more than likely lose the renters who are long term renters. How would you all proceed in raising rents? Would you even buy the property?

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Investment Info:

Single-family residence buy & hold investment in Athens.

Purchase price: $35,000
Cash invested: $115,000

We're still in the process of rehabbing. It's been a slow process due to COVID. I'm thinking about getting a HELOC instead of financing. Cash flow before pulling any cash out should be $700. The most difficult part is fixing the mistakes by the subcontractors. My wife and I see this house as paying for education.

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

It was going to be an easy BRRRR.

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

I found this deal on Zillow and negotiated down to $35,000.

How did you finance this deal?

We did a cash out Refi from our primary resident.

How did you add value to the deal?

The biggest value add was going from a 2/1 to a 3/2. But we also replaced water and sewage pipes. Upgraded the electrical panel and wiring, new flooring, kitchen and bathroom cabinets, new appliances. Nothing in this house is original.

What was the outcome?

Property appraisal was $126,000.

Lessons learned? Challenges?

Check your contractors regularly. Know the building codes because if a contractor does it incorrectly and you have already paid
them.Your never getting them to fix it. Never pay anyone by the hour only by the job. If you can't be with them everyday nothing will get done and you will pay $$$.

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

Jennifer Cole- Keller Williams Athens TN was awesome. We looked at 10-15 properties and put bids on 4 or 5.

I spoke with my lawyer when, I created my LLC. He stated that as long as the LLC was family owned and you only invest in single family properties. Multi-family up to four-plex if you split it up into single units. You would be exempt from the franchise and excise tax. Speak with a RE attorney to be certian.

Thanks everyone for your responses. 

Thanks for the info. What are your thoughts on investing in one of these properties?