All Forum Posts by: Lee Hampton

Depends on how North? If it near Northside, I could be an option. If much further North than Little York, I’d refer you to a builder that I have observed operate with integrity and professionalism. Option also exists to self GC with guidance from an experienced builder. My bio can be viewed at www.leehampton.com/about-us/

@Tatyana Edgeworth  Sure if you can find something that meets your criteria.  Suggest you link up with a realtor or wholesaler, someone who specialized in finding deals for others.   And I would not rule out Single Family, it just gives you more options.

@Account Closed It's impossible to give an intelligent figure with limited data and specs but Ballpark $110/sq ft +/- 20%, assuming you are hiring a General Contractor.  

You will need to be more specific when soliciting mentors or consultants.  Otherwise, it will feel like you are sitting still in a taxi with the meter running.   You already have valuable real estate experience and you are financially well positioned to execute transactions.  Suggest you put pen to paper and work thru your goals, risk tolerances, time frames.   Then determine how much time you have to dedicate to real estate.  This will narrow things down considerably.  

There really is no "reasonable" profit margin.  Every investor is different.   West U. is very insular, there are very few marketable properties that slip thru the cracks on insiders.   Note:  All Rice blvd West U properties are not the same.  The West end of Rice Blvd is very different from the Central or East end of Rice blvd, minimum $150k delta for same size lot.  Proceed with caution.

The demand for existing (2-4 unit) multifamily(MF) far exceeds supply, which by definition means prices are inflated and there is very little “value”. The limited inventory available of duplex/MF falls in 1 of 2 categories 1) old, poor quality and potentially rife with problems that may persist over time 2) structures that were not originally intended to be multifamily but have been modified/rigged in a feeble attempt to be MF.  IMHO, the better play is to build from scratch, control the quality and have something that is sustainable. Full disclosure: I’m a builder/developer but I do employ this approach for my own personal portfolio.

Mike is spot on. Your main challenge is your DTI, even though the asset is in name of LLC, you will likely need to personally guarantee the loan which will ultimately lead to your credit and DTI. If tenants have paid two months rent, you may be able to use that rent to increase documented income.

I'll inbox you a couple of local/community banks that might be willing to lend.  It would be helpful if it is a lower income community which will help their CRA rating.  Also, if there is a community bank in close proximity to the property, you should speak with them as well.   Do not waste time with the Large/National banks. 

@Kat N.   

By any traditional analytical method, this deal is a hard “pass”. But just reading the tea leaves, I’d guess this is a momentum play and the property is in an area that is rapidly gentrifying. I’m on the ground in Houston and we do have “under the radar” areas that have high upside. So you may actually be paying for potential, not current value. I have purchased several vacant lots 24 months ago in said areas, which now appraise for 2.5X purchase price. There is always a subtle catalyst that is driving the price increase. Finding these is both art and science. I’d redirect my questions with this in mind, because just by the numbers, the deal you outlined is a no-go.

@Gabriel Novotny I would call what is going up in Independence Heights as mid-level production homes at best.   I have something just south of there in Greater Heights.   Budget $115/sq ft.   I you are planning multiple(3+) units simultaneously, then less.  Lumber prices throwing things off at the moment, but by the time you build, i expect them to return to something close to normal.  

For budgetary purposes only,  $95 to $130/sq ft is a good range. Your feature sheet will determine where you fall within this range.    High-end is truly ambiguous.   If you are talking true high-end, .i.e, Sub-zero/wolf appliances,western window systems, then i would have a different discussion.    My confidence leads me to say  "I own the best construction company in Houston".    Reality says you have to find the right fit for your budget, personality and size project.   Interview multiple builders, listen to your gut, then ignore your gut and go on  "nothing but the facts", then turn gut back on and see if guts and facts align.     

All in including repairs, post lift.  $75,000 to $150,000.  Numbers based on houses lifted in Meyerland, which is 3 miles south of the Galleria Mall.