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All Forum Posts by: John Joyce

John Joyce has started 5 posts and replied 17 times.

Post: Opportunity to build on family land

John JoycePosted
  • Investor
  • Scituate, MA
  • Posts 17
  • Votes 7

Thank you @Brenden Mitchum your response was very helpful. I like your 3rd option with the seller carry, but just want to clarify some things so I understand it better. I would take ownership of the property for $0 down and promise to begin making monthly payments after it is finished and rented. Then apply for a construction loan to build the house. Then refinance the finished house to pay off the construction loan and possibly the loan to my father. Does that sound like a reasonable plan, or are there any flaws that you see?

Post: Opportunity to build on family land

John JoycePosted
  • Investor
  • Scituate, MA
  • Posts 17
  • Votes 7

I have an opportunity to tear down an old house on land owned by my father and rebuild something new. I am leaning toward a rental and holding onto it for a while. Problem is that I don't know the appropriate approach to analyze it as a deal. Should I try to buy the land, or share profits with my father? Are there different ways to look at a deal like this?

Post: Advice on 1st real project

John JoycePosted
  • Investor
  • Scituate, MA
  • Posts 17
  • Votes 7

Ok BP crowd, a new guy needs your advice/perspective. This is a long one, so please advise if I should split it into more specific forums or posts.

A family member has a run down property that he owns outright. 2 separate buildings (1- 2000 sqft, 1- 800 sqft) both 2 stories on a single lot. Both currently rented by family about half the market rate. Both also need major rehab/ likely tear down. My idea is tear down and build a single "L" shaped building, 2 or 3 stories split into 3 or 4 units. A neighbor recently pulled off a similar project, so I believe the town will allow it (fingers crossed). The goal is rental income, possibly a single unit short term rental. Location is right on a New England beach, so good for airbnb/vrbo in the warmer months. Ideally I manage the project and pay for the loan to carry it, while the owner provides the land in exchange for income or product. He will never do anything productive with the buildings or land, so I am hoping to be the catalyst to turn it around. The owner is a General Contractor and I have worked for him in the past, so we are both very familiar with building in the area. But I don't think we'll build this project because my other job is currently paying the bills and he is easing into retirement. Also can't be your own GC on a construction loan.

Here some of my questions:

Do I go for a commercial construction loan, because I can't satisfy the owner-occupied requirement of most other loans?

Pre-fab or stick built? Never done pre-fab, but I like the idea.

How would you analyze these 3 options 1) He sells it now and moves on 2) Build and sell units 3) Build and rent units? I like the rental option, but I want to present him with an analysis of all of the options.

What are some other creative financing moves to make a project like this happen? I don't have much money so I would need a loan. He has plenty of money to finance the project, but then I'm not really needed. I don't have much money, but I think I want to borrow money and take on that risk in exchange for some future income and experience of doing my first "deal".

Post: Two College Seniors Navigating First Investment

John JoycePosted
  • Investor
  • Scituate, MA
  • Posts 17
  • Votes 7

 @Reed Baker try loopnet.com if you are looking into multifamily. As finance/business minded people, you may find some interesting commercial real estate opportunities on loopnet. Nothing says you can't buy a mixed use property with commercial first floor and rentals above that. It's probably not going to allow the owner occupied super low down payment option, but you can make it happen with creative financing.

Seller's agent suggested converting it, but had not asked the city. He mentioned that the city is looking for more housing, which makes me wonder if there is a trend right now of converting commercial to residential in the area? I am definitely not blindly taking his word for it and I'll make some calls to the building department before I walk through with a contractor. My uneducated guesstimate was about $50k for a 2/1 and a 1/1 on the first floor. I also plan on touring it with a property manager, so I will have much better numbers before I make an offer. The building does have plenty of parking (about 20 spaces) and a 2-car garage. It is zoned for Commercial General but it looks like a SFH, so it may have been in the past. I have always been under the impression that it is easier to go from commercial to residential, rather than the other way around. But that's also just my experience in my town, and I know nothing about Pawtucket (or Rhode Island) norms.

Looking at a building in Pawtucket that is currently commercial first floor with 2 one bedroom units on the second floor. The commercial space is vacant, and I don't have a ton of faith in small businesses as long as this COVID thing drags on. COVID took out the previous commercial tenant (also happens to be the owner). My question is what is the likelihood that I can convert the first floor into 2 units? Any opinions on whether or not the city would approve it? Also any general idea on rehab costs to add 2 kitchens and 2 bathrooms (all lower end finishes for a class C type of property)?

Post: Question on investment options

John JoycePosted
  • Investor
  • Scituate, MA
  • Posts 17
  • Votes 7

I am new to this too, but I have a similar financial situation. Here's my current BRRRR plan:

1) Find a 3-6 unit class C or D value-add property.

2) Use a HELOC on my primary residence (SFH) to get about $50-80k

3) Pull about $30k out of savings

4) Pay downpayment and rehab costs

5) Get it rented

6) Cash-Out Refinance once the cashflow and capital improvements increases the value

7) Use cash to purchase next deal and repeat process.

Post: New to RE Investing from Scituate, MA

John JoycePosted
  • Investor
  • Scituate, MA
  • Posts 17
  • Votes 7

 @Kevin Kelly I don't plan on moving, so a traditional house hack is out of the question for me. I'm looking for cashflow from small multifamily. But in the near future, I may be looking for a house hack for my father. Ideally he wants to live in an apartment over a garage, and rent out the house. A duplex with a 3rd over a detached garage would be prefect.

Post: New to RE Investing from Scituate, MA

John JoycePosted
  • Investor
  • Scituate, MA
  • Posts 17
  • Votes 7

 @Eamon M. Keane I'm not really into the wholesaling game yet, kinda makes me nervous. But I will definitely keep you in mind if I warm up to the idea. Under 500k in Hingham is hard to find, nice work!

Post: New to RE Investing from Scituate, MA

John JoycePosted
  • Investor
  • Scituate, MA
  • Posts 17
  • Votes 7

 @Erik Kraemer I don't expect to find any deals on the south shore in my price range. I'm looking in Pawtucket/Providence, NH & ME but not more than 3-4 hour drive from South Shore. I don't have a lot of cash or equity to work with so I am looking for a small deal. I tried talking to a few owners about a variety of owner financing options but they were all totally against it. I would also kind of like my first deal to be all mine, so if I screw up I don't have to answer to anyone else (or risk needing to borrow from Peter to pay Paul).