All Forum Posts by: Brian Ton

@Elliott Elkhoury $1,600. Inherited a tenant on lease until September 2019

@Darren Lenick based on my own personal observations from living in the South Florida/WPB Area for most my life, and multiple sources of feedback, all indications are that the area is progressing from a "C" class area more towards a "B". Of course,  all dependent on the specific location...but generally speaking. Lots of properties getting flipped around there and lots of investment activity. The outcome seems to trending towards increasing property values throughout. There's recent commercial activity with restaurants and shops (Northwood Village, for example) that seems to either be driving it or complementing it, which I interpret as a good sign. Looking at other neighborhoods in the greater WPB area, my opinion is that the area has good potential. 

@Hae Y. Thanks so much! It was an exciting first purchase. Went into with a lot of previous research and self-education, mostly from Bigger Pockets. First inspired by the audiobook version of the classic, Rich Dad Poor Dad!!

Went in prepared and everything went down as planned. Hoping to continue improvements to the property and eventually sell somewhere in the 5-7 year time frame. Lots of excitement in the market at the area, so hoping for a nice back end profit with the future sale after adding some value and the expected market appreciation (the Northwood district is evolving quickly in terms of demographics and commercial activity). 

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $99,000
Cash invested: $100,500

Duplex in the Glades area. This property was my second overall real estate investment purchase.

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

Cash on cash return. Discounted property values in an economically depressed, but improving area.

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

MLS (Redfin). Property was fairly priced and numbers were profitable to my criteria at asking price. Inspections and appraisal were favorable.

How did you finance this deal?

Cash purchase.

What was the outcome?

Inherited two long-term tenants in each unit. Continues to be an income producing property.

Lessons learned? Challenges?

Things are much easier with a good property manager. While still under contract, had to pull permits for the new metal roof that was previously installed. Agents helped take care of everything.

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

Melissa Blount & Luan Walker, Sugar Realty in Clewiston, FL

Investment Info:

Single-family residence buy & hold investment in West Palm Beach.

Purchase price: $148,000
Cash invested: $48,500

3 bedroom, 1-1/2 bathroom single family home purchased in the Northwood Historic District in the West Palm Beach Area.

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

Projected cash-on-cash return. Target achieved with current actual annual ROI = 13%+

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

Recommended by partner real estate agent.

How did you finance this deal?

Conventional mortgage.

How did you add value to the deal?

Addressed existing issues with roof, minor electrical, HVAC repair and heater installation, fixed broken windows. Acquired property at discount through post-inspection negotiation. Between future lease contracts, intend to fix floor/foundation issues with minor rehab throughout.

What was the outcome?

It continues to be an incoming producing property with net cash flow after financing, maintenance, etc.

Lessons learned? Challenges?

I manage this property myself. The inherited tenant does not shy away from reporting issues. After 3-1/2 months of ownership I would hands-down recommend that for buy and hold properties, to always address any maintenance related issues immediately. Problems don't go away or get better by themselves. Just handle them.

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

Heidi Johnson, Keller Williams.

@Wayne Brooks I'll likely have to pay them a visit, thanks. Unfortunately the modification was already completed with one of the previous owners. It's an approx. 400 sq. ft. garage that was converted over to a full studio with plumbing for a bathroom/shower, and a small mini-kitchenette.

My fingers are crossed that while not permitted from the get-go, that the work on the modification is code-compliant and that it'll just be a matter of just getting it permitted after inspection. Complicating matters worse, the unit is occupied--so it's looking like I'll have to ask the seller to have that unit vacant prior to closing if I don't want to put myself at risk.  

@Jeremy England thanks for the response! I'm hoping that it's not the latter...

Greetings BP fam! I am thinking about making an offer on a multi-unit property that has been listed as a "triplex" that is actually a duplex with a detached garage that has been converted into a studio efficiency unit. I'm told by my agent that the current (or previous) seller that did the modification to the garage did not do all of the proper permitting before doing the construction. It is currently occupied.

Found an old listing info reads, "garage can be turned into permitted efficiency for additional income for approx. $6000 to $7000." What do they mean by this? If I were to acquire the property, what would I have do to make this a legitimate (and safe) dwelling without putting myself at risk? Do I need to evict the occupant?

Thanks in advance, all!

@Leo Jurado Thanks!

Seems like Rich Dad, Poor Dad is a common theme here on BP! I also saw that you have attended some events and that you're also a fan of Mr. Robbins--amazing individual, that dude. I'm all for networking and sharing thoughts/ideas, especially with my fellow locals. I'm trying to make the next Tropical REIA in August, maybe I'll see you there.

Best of luck with starting a new and exciting chapter!