All Forum Posts by: Joro Yeager

@Nick Liddell Sarasota is a great market to be in and will only be getting better in the coming years. As for buying opportunities, all of the local investors I work with were expecting a big drop in prices and a surge in motivated sellers like ‘08. But it seems that COVID just put a pause on the market for two months and now the market is bouncing back to normal pretty quickly. It’s smart to target Airbnb listings though as I’m sure some won’t be able to recover from this spring.

@Drew Simpson $100,000 is plenty to get started if you use a hard money lender for the purchase and rehab. Most hard money lenders require you to bring 20% of the purchase price and they will fund the rest plus 100% of the rehab.

So find a good deal where the purchase price, rehab, and hard money interest is less then 80% of the After Repair Value that way you can refinance with a conventional mortgage after the repairs are done. This would pay back the hard money lender and your initial 20% and you would own the property with $0 out of pocket. Then you can decide if you want to house hack, rent, of flip it.

@Drew Simpson Sarasota is actually an incredible market for short term rentals. Airbnb’s have a very high occupancy rate here and furnished seasonal rentals hit 2-3x the annual rental rates in the winter and summer seasons.

I agree with the above comments that you should start with a smaller and simpler deal. But I think they were a little harsh with their responses. How else will you learn without getting feedback on your projected numbers.

@Michele Dennis Hi Michele, I’m from Sarasota and just saw this post so I wanted to reply in case you are still on BP. What area of real estate did you end up getting into?

@Jim Hendershott Hi Jim, not sure if you are still looking to buy property in North Port but I currently have one for sale at 80% of market value. It needs very little work and would rent at an 8-9% cap rate until you are ready to convert it to a vacation home.

@Alex Smith I'm not as familiar with the Ft Myers/Naples markets but in Sarasota County, it is pretty easy to keep a furnished short term rental booked most of the year with snowbirds in the winter willing to rent at 2-3x market rates and vacationers in the summer at around 1.5x. COVID definitely hurt short term and vacation rental owners this spring but once this is done things should return to normal. And @Bryan Trelegan is correct, we are starting to see a downward trend in prices which will mean that it is a great time to purchase long term buy and holds. 

We are expecting a short term dip over the summer due to buyers being hesitant purchase and we are preparing for about a 5% market correction by this fall.

We are still buying but being much more aggressive with our offers. However, we haven’t seen sellers start to reduce their asking prices yet. 

Hey Andrew, 

I was able to negotiate with the county and they agreed to reduce the lien to $5,500 to just cover their costs. However, the bank decided to fix the septic issue and auction it again. Unfortunately, the winning bid was higher then we were willing to go so we didn’t get the property.

Hey everyone, I wanted to get some feedback on a strategy to leverage a septic violation lien to acquire a property.

I am currently negotiating with an Asset Manager on a REO property that has an ongoing septic violation and a $240k (estimated) lien that has been accumulating at $50/day since 2005. The bank is trying to sell as is for $310k cash only and pass the lien and septic issue off to the buyer.

My plan would be to offer $50k in cash to purchase the property and assume responsibility for both the septic issue and the lien. After repairing the septic violation (estimated $20K), I would go through the reduction hearing process to have the lien reduced as much as possible. I have seen other members post that they have had reductions of 15-90% once the issue has been resolved. After six months I would get a mortgage for up to $310k to cover my purchase price, septic repair, and the final lien amount.  

If this strategy worked, the worst case scenario is that the lien is not reduced and my total cost for the property is $310K. Best case scenario is that the lien is reduced by 90% or more and my total cost is $94k.

Is there anything obvious that I am missing on this strategy?