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All Forum Posts by: Lance Middleton

Lance Middleton has started 8 posts and replied 25 times.

Post: Gut(?) Rehab Estimates on Foreclosure

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

@Tim White, @Vernon Trice III

I decided to pass on this property. After walking through with my agent and getting some of his feedback/estimates, I just was not comfortable with the amount of work and unknowns involved with this project. If I had a larger cash cushion it might of been a different story. Nevertheless, I think it is a good deal for a worthy investor(would of been my first deal).

Post: Gut(?) Rehab Estimates on Foreclosure

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

Thanks for the reply Jay, I should of mentioned my intention was to live in it for at least a couple years and have the option to rent it out if/when I move. Either way I'd refinance it after the rehab.

Post: Gut(?) Rehab Estimates on Foreclosure

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

Good Morning BP Community,

I'm looking at a owner-occupant(it probably would be sold by now otherwise) foreclosed property in Huntsville, AL and wanted peoples quick opinion on if this is even worth pursuing. Would be a buy-and-hold/BRRR.

Zillow Link: https://www.zillow.com/homes/for_sale/Huntsville-AL/92140807_zpid/12014_rid/2-_beds/0-100000_price/0-379_mp/globalrelevanceex_sort/34.704691,-86.610042,34.694723,-86.623989_rect/15_zm/?

Walk-through Video: https://www.youtube.com/watch?v=QeiuirTqxcg&feature=youtu.be

Here are the details:

- List Price: $13,900 

- 1600 sq. ft. 4 bed/2 bath

- (C-) area, but gentrifying

- Comps with med. builder grade finishes ~ $70K-$100K

- Rent Comps ~ $900/mo

- The house has multiple code violations (see picture below):

- At the very least needs(new): roof, electrical box, water heater, a/c unit, flooring, windows, doors, kitchen gut, bathroom gut, couple walls removed.

- As far as I can tell the structure itself is o.k.

So...

This would almost be a gut rehab in my eyes. The bedroom/bathroom walls all seem fine, but the "living area" is separated by an awkward couple walls(see video) that I would want to remove and if it make sense add a support beam and open up the kitchen and living area completely. I know it's hard to estimate gut jobs like this but I was hoping some professionals might give me a ballpark idea. Currently I am estimating $40/sq.ft, so all in at ~$78k which means I'd almost be breaking even.  

Huntsville, AL is a hot market. Another option would be to buy the property, demolish the house and hold the land until a new build makes sense. 

Everyone's input is greatly appreciated! Thanks so much!

Post: German Schmear Exterior?

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

Hi everyone! I looked around to see if this question has already been posted but couldn't find anything.

I know a lot of people say that painting brick is a bad idea since you have to re-apply paint every ten years or whatever. But what about the German Schmear technique? Is that has maintenance intensive as painting brick or is it a one and done type thing?

And I realize that some people may not like it, but I believe enough people in my market would like it. Maybe I'm wrong. This would be for a personal residence that I will be fixing up while I live there and renting out later. 

TLDR- German Schmear on rental, yay or nay? 

Thanks guys!

Post: Please allow me to introduce myself...

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

Welcome to Huntsville @Andrea Parsley! I also recently moved to Huntsville and am in the same position as you. Been on BP for a couple years but I'm only just now looking to by my first property.

Post: Looking to invest in Huntsville, AL

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

@Rebecca Pullen,

I know David Green has mentioned it on a podcast before.

I can't even figure out how to search with the new update. Glad I'm not the only one who has issues with the app.

Post: BRRR on Personal Residence (BRR?)

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

Thank you for the responses everyone! Would this strategy still work if I only put say... 50% down? It's possible I will not have the funds for an all out cash purchase to begin with. The reason I ask is because I am renting and would like to purchase something before this lease ends(I do not have a month to month option). 

Post: BRRR on Personal Residence (BRR?)

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

Thanks for the reply @Hattie Dizmond. Good advice about a local bank. I've actually been planning on visiting one soon for that purpose even though I won't be in the position to buy for another 6 months or so.So even if if the above hypothetical deal only appraises for $50k and I get $35k out of it would that still be considered a good deal? Say I get $30k out of it. I'm still getting a rental property out of it right?

Post: BRRR on Personal Residence (BRR?)

Lance MiddletonPosted
  • Huntsville, AL
  • Posts 25
  • Votes 11

Hello BP Community.

This maybe a stupid question, but I am curious if there is a way to utilize the rehab and refinance method on a personal residence. Say I bought a house using all cash and while living there I slowly fixed the place. The ultimate goal of eventually renting it out after a year or so, but can I refinance the property and pull the cash out while I am living there? 

A hypothetical example:

I buy for $30k cash. Put $10k repairs into it while living there(a year or so) and have it appraised at $60k. Refinance at 70% LTV pulling out $42k. After that I rent it out at $700/month. Use the $42k cash to put into next home and perhaps repeat this process. Similar to a live-in flip process but renting it out afterwards instead.

Any input is appreciated! 

Lance