All Forum Posts by: Juan Diaz

Get off your butt. You’re being lazy. Heck, I’M lazy sometimes too. But that’s no excuse. Laziness is probably costing you thousands of dollars right now. Is your property sitting empty waiting to sell? Get some Airbnb renters in and cover your carrying costs. Are you waiting on permits? Stop sitting here reading the internet and get on the department that’s holding up the process. I don’t know how many months (and tens of thousands of dollars!) I’ve saved by following up on city employees who’d shunted my project off to the low-priority list.

I don’t know you, but I know that there are probably a few little invisible things like that costing you thousands that you’re not thinking about at all. I can use a kick in the *** to stop accepting these things, and I bet you could too. So what are you going to do to get rid of those thousands of dollars you’re wasting because you haven’t put in the right effort?

 You still run into the problem of developing lots of units...securing piecemeal financing might reduce the financial load a little bit, but it might be offset by the synergy you could get from building everything at the same time. Would not want to tackle larger projects like this until we had the experience with the smaller ones, and then you might as well develop everything at the same time

 I agree with Karen's feedback. In regards to building larger projects, we want to make sure that we are more certain of the processes involved in developing before we increase our scale. Building from scratch has a lot of pieces, and right now our biggest development is a four-townhome parcel in San Leandro. After we're able to successfully develop these parcels, we may look at larger opportunities, but because of the size and risk, we want to make sure we've got our processes down before we scale up.

The other hurdle you'll run into is that financing will be very hesitant to lend you money on a big development unless you've already proven your bona findes. It's a natural progression to go from flipping to building an SFR to building a 2-4 unit project to building larger projects. I don't know that we would have been able to secure financing for anything with 10+ units before completing our 2-4 unit projects, but then again, we haven't tried

Hi All,

Since I've got a lot of projects going on, I thought I'd consolidate the updates that I post onto one thread. I'm not too great at consistent updating, but when I do update I'll post on here!

Here's (a few of) my current crop:

Golf Links Rd, Oakland

This one was a quickie—we found it on the MLS, and as soon as we took possession, we had it ready to go on the market within a week (we waited a few days to list on the standard day). This one was pretty easy, entirely cosmetic. Spending about 20K to paint inside and out, add a new range, and stage. Otherwise, keeping it the way it is, and we're looking at about $140K price difference from buying to selling. It's looking like a quick and easy deal.

Pics:

Caswell Ave, Oakland

This one we bought in October, but the tenants weren’t out until a month or two ago. Tenants in the Bay Area are a handful and a half—it can be almost impossible to get them out. Fortunately we were finally able to motivate them to go for a cash for keys agreement, and we took possession. It’s a smaller house in a sketchy area, but the holding time allowed prices to appreciate even more. On the net, the appreciation should cover the small holding costs that we had incurred.

Pics are coming on Caswell

Down to the studs.

25th St, Oakland:

 Thanks David! As far as the financial state of the seller, they did not do a great job of managing their finances...there were a couple tax liens that we had to take care of when we purchased.  I don't really know exactly why the seller chose to go the route of selling it to us, but I'm glad they did.

Private money is secured against the property. Credit cards are secured against you, including every single one of the properties you own. Also carrying over a high balance for a few months might negatively impact your credit score, depending on how high the balance is to the amount you can borrow.

If you can get 8-9% from a credit card company, you should be able to get similar terms from a PML.

More photos:

http://www.meetup.com/The-Foreclosure-investor-tour/photos/26116342/

We’re going to make bank on this house. We bought it for $160K, put in $100K, and we’re looking to sell for over $500K. This house will be a HUGE winner for us. I’ll get into some of the rehab details later on, but how did we get such a steal?

We timed this house PERFECTLY. Timing is everything they say, and it was especially true in our case. We put an offer in shortly before this house was set to be foreclosed on, and the obviously-motivated buyer was eager to take up our offer and get out before the house could be sold at auction.

Timing: we got her a cash for keys, and got her out of the house within a month. In Oakland this is SUPER important, because she could have really dragged out the issue. It was worth it to pay her $12K to be gone.

Timing: we got in, got out, did all the necessary work, made it pretty, all in about three weeks.

Money report:

$160K purchase

$12K cash for keys

$100K rehab

Rehab details:

We’ve got the pictures of the exterior in the first post, but one thing I forgot to take pictures of was the interior of this place. And boy, this was a doozy!

We bought this a little before it was due to be foreclosed on, and the people inside had been living like animals. There were containers of crap and piss everywhere, and the house was completely disgusting. It was a true dump. And now…check out the after pictures! It was ready on May 8th, so about three weeks since we were able to get access to the property.

Finished product:

I agree with many of the points brought up by others on this thread. I buy/sell in the Bay Area, and have used both flat-fee brokers, pay-by-salary brokers, and full commission brokers.

A: A good full commission realtor/broker will always get you an extra 5-10% or more on the property. 

B: Buyers will almost always come with a 2.5% buyer's commission, so you're really only saving less than 2.5% by going with a flat fee or pay-by-salary

C: Feel free to broach the topic of flat-fee representation with a selling agent. For the right place, you might get some nibbles. 

D: A good realtor will double as an inspector...can look through the house, come up with a punch list of last minute things to clean up before showing.

E: Real estate in most parts of the country is sane. With an average house price of about $200-250K, your average realtor is netting about 30-40K a year. Not really making bank. There are many people who get their realtor's license and wash out after a few months, because it's not really lucrative.

F: Good realtors can milk their networks to sell the house super-quickly

G: A flat-fee or salaried realtor doesn't care what your house sells for, as long as it sells. S/he doesn't get a cut of the sales price.