All Forum Posts by: Lucas Villanueva

I added some pictures and made some edits to my profile!

Investment Info:

Small multi-family (2-4 units) fix & flip investment.

Purchase price: $450,000
Cash invested: $28,000
Sale price: $650,000

We initially bought this property to hold it for a long time. We house hacked the property with the idea if living there for two years. We were able to buy a house after two years and keep this property as an investment.
Due to the current appreciation in this market, we decided to sell and move to something bigger. Currently looking for properties outside the Boise area.

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

The potential this property had.

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

Trough the MLS.

How did you finance this deal?

We used a FHA and housed hacked the property for two years.

How did you add value to the deal?

Remodeling each unit an raising rent.

What was the outcome?

Great!

Lessons learned? Challenges?

We had issues at the beginning. It takes some time to get any property operating smoothly.

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

N/A

It’s very hard to predict. I think you can gain appreciation in any market if you are willing to hold the property for a long time but I don’t want to be loosing money and have a negative cash flow every month and hope for appreciation. The numbers to me don’t make any sense. I drive by multi families a lot and in most cases they don’t look very nice. Renting them for anything more than 1,100 would be hard.

The problem I see is that Boise it’s a very small place. Jobs don’t pay much, comparing this to Seattle Portland or Salt lake city. For what it is the housing market has already appreciated tons so I don’t know if it’s worth the risk. But yeah maybe looking for flips would make more sense.

What do you guys think is going to happen in the Boise area? There are a lot of properties that are very overpriced. Is it worth to try to buy in this market or better to move to a different one?

People don’t make too much money around here. Most people that buy houses at the current market price are from other places like California.

What I see is that people that rent, are making Idaho wages, and will have a hard time paying the amount of rent that is needed to make current deals work. People from other areas buy new homes or if they decide to invest in real estate, they put a significant amount down. They buy their cash flow.

What do you guys think? 

This sounds awesome! My wife and I would love to attend to the meeting. We started working on real estate and would love to meet some people in the Boise area. Thanks @Jonna Weber for putting this together. 

Congrats!!

@Franco Li ha! Yes no doubt that would be very unethical and NOT what I intend to do. Especially since I'll be living on sight and would not want to wake up to slashed tires. I was just curious in this hypothetical situation. :)

@Kurt K. I get what you’re saying. Rent is $75 below market so I don’t know if that's too high of a raise from the start. How much did you bump yours up?

I think I might plan to give them 37 day notice, that way they have a week to think about it and see what's available on the market (hopefully they will opt to stay as it is a fair price). If not, they will have 7 days before the 30 day mark to give me a 30 day notice to vacate.

My end goal is to be able to do a nice rehab to make the place very modern and raise rent by $325 more to what they are currently paying. 

Thank you @Jessie Tetreault and @Adam Schneider, I would definitely double check how many days are required in Idaho. I don't plan to raise rent every month (that would be cruel and bad business, this was just a hypothetical question) :-)  but I do plan to give them a heads up that rent might potentially increase in the next few months due to renovations. That way they can plan in advance for it.

You'll need a hummel "sander" and the lowest grit belt you can get. You need to know how to use it because you can make a hole in the floor really easy (videos look easier than reality). I’d get quotes from different flooring companies, they should charge you less for just removing glue, I believe about $1 per square foot. Scraping will take forever and it is a lot of work. Hope this helps, good luck!