All Forum Posts by: Jose Gandulla

Thanks everyone for their responses I agree that the price is probably the biggest concern and to @David Dachtera 's comment( love the yogi bear reference I loved that show!) that he does indeed need a reality check which is what I will have to explain to the Realtor as well. The property is free and clear besides some tax payments coming up in a couple months Thanks everyone for the information. I will keep you guys posted!

Hello BP,

During one of my direct mail campaigns( I am a wholesaler) I came across a property that I need some serious advice on. Normally I'm ok ( def not an expert) on determining repair costs and ARV but this one has got me stumped for several reasons; Asking price, Comps, whether to do a complete makeover of the home or demo the house and build a new one.

Property in Question:

Built 1860

6bd 3.5 bath

2836 sft

sits on 3.38 acres of land

property concerns:

Needs MAJOR upgrades: heating system, plumbing, electrical,roof,windows, walls,flooring, sunken floors in some rooms,major paint, appliances, kitchen needs full remodel, all baths need full remodel.

Positives: House is structurally sound ( would recommend further investigation on this)

the area is a very affluent rural area and property does have potential if done right.

Comp #1

Sold 4/28/16 for 389,000

Built 1980

5bd 4ba 

2753sft

Comp #2

Sold 2/26/16 for 366,900

Built 1955

4bd 2.5 bath

2500sft

ARV of property 375,000 (average of the two homes that were less than 1/2 mile from property in question)

These are the best comps I can come up with. Other homes in the area either had too few rooms, not enough square footage, too far away, and not within the past 6 months. The house is currently under contract with a Real Estate agent who would be more than willing to split the commission with me. The house has been on the market for almost a year and the seller does not intend to renew.

His asking price 275-280k

His reason for selling?

Has had several bad experiences with tenants. Has had several low ball offers around 250k.The house is divided among four owners and all are in agreeement that they want to sell the property.

My Question:

Is there more potential in a complete demo and build a new home similar to the ones in the area and have the extra land as a value add, or can this home be saved and if so, is the 275k a good price for both scenarios. I am unfamiliar with the costs of a new build which is why I'm reaching out. All comments, questions, criticisms are greatly appreciated. I have pictures of the property for those who are expressing serious interest. Thanks again.

@Brent Coombs, @Aaron Montague, @Curt Davis, @Chris Seveney, @Nazz Wang, 

Thanks everyone for the feedback! HOA and Cap Ex were two items that I completely forgot about. My objective as a wholesaler is to look at these properties from the end-buyers point of view. Find out how these properties can work for them. Aaron I would greatly appreciate a detailed analysis. I could use the Calculator here, but I want to understand myself first how the numbers work. Anyone can present a piece of paper but if I cant explain it in a language a potential buyer can understand that paper is worthless. I'll definitely run some more properties for review!

I analyzed this one property just to see what's out there. Any Feedback would be greatly appreciated.  Analysis: Townhome

3 bed 2.5 baths 1800sf rent ready(light cosmetic repair is optional) rent is 2000 a-month purchase price is 255k expenses come up to about 800 per month(property taxes, insurance, vacancy rate 10%, property management 10% and repairs 5%) leaving about $1200 cash flow. Cap rate is about 5.5%. In order for this to work it would have to be a cash purchase. If it were financed the cap rate would be negative resulting in a negative cash flow. Comps were pulled of zillow only sky view pictures were available.

Comp #1
3 bed 2 bath
1,770 sf
Sold 7/21/15
285k
Condition: Unknown
Comp#2
4 bed 2 bath
1173 sf
Sold 5/28/15
280k
Condition: unknown

I am no way shape or form an expert.I am in more or less an infant admiring those who wear the big boy pants in this industry! I do  have a question about a particular approach towards commercial real estate that i would appreciate feedback on. I have been involved in the health and fitness industry for over 15 years and an increasing trend that I've noticed through literature and first hand experience is the surfacing of "specialty studios". I'm not talking about Crossfit. But more specifically, personal training studios that offer more than just personal training. Some are group training based,class based, while others operate as a miniature health club with a training focus. As opposed to the larger health clubs that operate at a minimum of 20,000sft, These studios range from 5-15,000sf. This kind of square footage i believe may be easier to find and allow this particular kind of studio to use the space to open their facility. There are a large number of these studios who have owners that are looking to expand their brand. Would an investor be able to reach out to these studios, help the owner find a location so that he/she can grow their business? The same could be said for physical therapists looking to open their own clinic. One could network with the American Physical Therapy Association to(apta.org) to inform either brand new or seasoned physical therapists that if he/she is interested in opening his/her own clinic, they could use us as a valuable resource to get them started.We help them get their business started, and in turn we are supplied with an endless supply of leads. Again, I have no idea whether or not this is a feasible option. I'd figured i'd ask first to see what the feedback is rather than making a grave mistake. Thanks

Just getting started into the world of Real Estate Investing. In the Education Phase of my growth. Absorbing as much information as I possibly can. PodCasts have been a great help in pointing me in the right direction as far as education is concerned. Interested in both residential as well as commercial.