All Forum Posts by: Lluis Bacardi

For me, most of the things needed to check viability of a lot at a certain price can be found online.

What usually helps more than the rest and not so easily accessible are a Survey, easements info and any Deed restrictions (depending on the area).

Obviously if you want to do more marketing, you can take a stab on checking what can be build, build cost and exit ARV; but I would like to think that most of builders prefer to do it themselves.

By the way, just send me any lots info you may have coming to you ;)

When I have done it, 1-2 Wks max if all documents are submitted.

Here is the form and most of information.

https://docsonline.sanantonio.gov/FileUploads/dsd/...

You need to submit online through Build SA website. If you have time, may be worth stopping by Development Services office and they will guide you.

Hi Kent,

I do have some rentals in that area and I also started doing new builds in other areas.

As others mentioned, this is not the nicest area of SA, and I would only do a project like this if you plan to hold it for a few years. If you plan for a quick exit, you may end up losing money.

Be ready to have rough tenants and be flexible with screening conditions, low credit scores, etc.

For your reference, we have a 600 sqft 1/1 rented at $700 and a 700 sqft 2/1 rented at $825. I honestly think the premium for new build in that area wouldn't be much more.

Construction costs have gone significantly, and being out of state I guess you will hire a GC for it? That's another cut.

If you don't have previous experience building, it will be difficult to find a local bank for it, so you may need to look into HML.

If interested, I can give you some contacts for construction and can help with the lending portion.

Also, keep in mind there could be a few "hidden"costs that you should check before finalizing budget: are there utilities in the lot? Connecting water/sewer to city lines will cost you 10-15k minimum.

Feel free to PM me if you have questions.

After sending all the information they wanted, w-2, taxes, etc; they said my properties did not meet 1.2 rule, which they do. 

When I asked how they were calculating it so I could check or learn, maybe I've been missing out something... they weren't willing to share how they were calculating it, saying it was their own way, etc... 

Basically, for reasons I don't know, they didn't want to do business with me.

Back to the 1.2 rule, I haven't had problems with another lender to increase my portfolio loan guidance they gave me about a year ago to add more properties, so that's why I also think there was something else that was not shared with me.

Just fyi, I tried with Sonora a few weeks ago and wasn't successful with them for a SFR.

Hi Roger,

If it was me I wouldn’t get in this area for this return, on a normal build and hold transaction.

But being new build, you repairs and capex will probably be very low for a few years so you could ride the first years and then sell when the big capex items start to be due.

On the other side, your build budget seems quite low, is based on experience? 

A 3/2 will be likely 1000sqft and that would be $60xsqft. Have you checked if the lot has utilities? Only impact fees for water/sewer will be over $5k.

If anyone can build in SA for that price a nice basic house, I can keep them busy for a long time :)

Good luck!

I use Corridor Funding (contact Jason Hirko) and they have always been very responsive, effective and able to close pretty quickly.

Jason Hirko is on the forum and he may be able to help you.

Hi Kristopher,

To get an accurate estimation you need to call CPS and SAWS with the exact address and they will tell you what you need.

I checked for a few lots and here are some guidelines:

- For electrical is quite straight forward, if you are 100ft or less from a post, there won't be significant cost. If they need to run a post, is about $1k per post but they also offer some credit back (I was told $700 per lot), so in the end your electrical out of pocket is very low.

If you happen to own several contiguous lots, you can use un post to cover several of them and reduce costs.

- For Gas, if gas line is on your side of the street, there shouldn't be significant cost, if is on the other side that may work different.

- Water/Sewer is the one that can break the bank for some type of deals. 

If the lot was never developed before, you will likely have to pay Impact Fees and this can go $5k or more depending on which part of town you are.

The only way to know for sure if they will apply to your lot is to call and ask specifically for an address. 

For example, I checked on a lot that has been empty for years and did not have to pay impact fees because seems that until 1986 there was a small house there, and therefore, they were covered long time ago.

Here you can find them: http://www.saws.org/business_center/developer/impa...

Note that these do not cover any sewer/main line work that you will have to do to connect to the house and that can easily run $5k more or higher.

Just PM me if you need any more details.

Hi everyone,

I would like to get some insight on a possible deal, which would be my first. 

I recently started looking more seriously into Real State to diversify were my money is and found this website which has been really helpful to learn about it.

Deal details:

House - Located in NE SA, near i-35 corridor. Built 1950, 1700sqft 3bed 2 bath in C Neighborhood (old town area, mostly working families but safe) The city has a household income of 60k and this neighborhood may be around 40k. The area is safe, mostly with old/immigrant people and significant number of properties being rented. School district is average/low, but not the worst.

Properties prices have stayed mostly flat last years because there has been quite a few development around with newer houses in the market.

House has been two weeks in market and price has been reduced once by 5k. Needs quite a few work.

My strategy is build and hold but looking to have a viable exit strategy in about 5-10 years max.

Here are the numbers:

Asking price - 80k

Closing & Remodel - 30k (roof has a leak, HVAC needs to be changed too)

ARV - 120k-125k based on Realtor Comp data

Rental - 1050$ based on Realtor Comp data

Vacancy + Property Management + Repairs + Capex (35% Rent) - 360$

Taxes and insurance - 217$

Mortgage (30yr-4%) - 302$

Cashflow - 171$

ROI - 4.47%

Considering above, and the risk on the area risk for exit strategy/future appreciation, the deal does not look very great so thinking of going this way:

- Offer 70k + Reduce rehab expenses to 20k which will give me 210$ cashflow and 5% ROI.

I still feel ROI may be a bit low but considering I want to diversify my money which is now all in stocks I would be willing to take on it.

Considering the low-mid growth potential for the area in the neighborhood is something you would consider?

Thanks for any advice!