All Forum Posts by: Shawn McCormick

@Gabriel Araya I would suggest speaking with a lender first. I have never had anyone do a construction to perm loan with FHA, but that doesn't mean it's not allowed, but if I had to guess it won't be. As far as build costs, materials are still experiencing a shortage and rising costs, so to quote something without plans, finishes, permits, utilities, septic/sewer, impact fees etc, I would expect very different quotes until you have all the answers. I have a client looking to build custom and was just quoted $140 from a very reputable higher end builder (not including land costs). So too many variables to really have an idea. But I would plan closer to $150 to be safe and always include a 'whoops' factor of 10-15%.

Good luck and keep us updated, would love to know how it goes.

@Wes Mccullar Happy to go over what I know in the Orlando market with you anytime. Our market was built for this and you can do very well all year. 

@Allen Motakef sounds like a great model, but seems (to me) difficult to do if you are not local. There are so many hurdles with environmental, permitting, engineering, working with city and/or county, finding a GC that you can trust with everything etc. Also, you are speculating to some degree as from start to finish could be 8-12 months from land acquisition to getting your CO, tying up your money for a long period.

A lot of Polk is zoned minimum 5 acre lots when you get in the more rural areas and Lakeland can be hit or miss in regards to the 'class' of the area. There is definitely a need and if you have the resources to put it all together, I think you would do well.

Keep me posted, I may have some good contacts for you in Lakeland.

@Jennifer Roberts and @Allen Motakef are you looking at track builders like Lennar, DR Horton, Pulte etc or from small local builders that build on lots that they purchase? If they don't even have a floor plan, I wouldn't waste my time flying out. The plans would have to be submitted and approved locally, have engineers, soil tests, water tests and much more...unless you are building with a larger builder. 

One thing I would advise is trying to get in really early in a community, phase one. The builder raises prices every few homes they sell and you will get appreciation due to that and by the time the community is finished, you have a lot of equity. I sell a fair amount of new construction and know sales reps at virtually all the builders and can likely answer any questions you might have about the process. 

One thing to be aware of is if it is regional/national builder, they use their own contracts and they are completely in favor of them should you ever want/need to back out..you will lose your escrow. If it is a small builder, you may have additional protections using the FAR/BAR contract that Realtors® use.

Hope this helps, good luck!

@Carley Wragg I have a few investor friends with STR in Sanford and the do quite well. One is literally finishing up an ADU on one of the properties because the demand is high and competition is low (everyone thinks they have to be by Disney) Fact is Sanford is a nice little town and growing as Aubrey said..right on the money. But STR in Orlando are not just for the theme parks. Funerals, grandkids, hospital visitors, traveling nurses, just visiting family, and all around people looking to stay AWAY from the parks and have something affordable will turn to you. I have other friends that do well in Eustis, Deland, Leesburg and other outlyers for the same reasons. Provide a nice product at an affordable price and they will seek you out.

I would caution zoning laws can/will eventually catch up with you, but then you can always go long term, just run numbers for both and enjoy the ride while you can. I have several property managers that cover that area as well as some co-hosts if that would be a better fit. Good luck!

@James Krell I would reach out to Joe Seagle with PCS law and title. He is extremely well versed in what we do. He has contract packages for wholesalers, seller financing and traditional, runs a title company and a land trust company too.

@Barbara Pinto, Mount Dora is very small, but does have a several block area near downtown that wouldn't be as attractive or command rents as the rest of the city.  Single family homes do great with snowbirds and others that love the area for what it offers, most of the multi family I see there is either in a bad area or very small units or both. I wouldn't use rentometer or other similar sources, call a couple local RE offices, there are about a dozen located in downtown Mount Dora to get a actual scoop on what rents would be. Good luck. 

@Account Closed I certainly don't know your market and contractors in most areas are handpicking jobs due to demand, but those prices are crazy to me! Many items would need more info on type/style of item, the comps in the neighborhood if they support those finishes, type of foundation (for flooring, plumbing etc)

But for 1000sqft, the demo can't possibly be 5,700 unless you are literally going to studs and moving walls. That is best suited for day laborers etc, pay by the job not the hour and rent your own dumpsters for $350-500 each, bet it could be done for $2k total. Flooring..is it glue down LVP or click..what foundation type. I pay about $1.50-1.75/ft installed for glue down, but we are on slabs here. You are paying $7.00sqft! Painting should be about $1.50-2.00sqft too. so even if that includes baseboards, doors, ceilings, texture, and paint for 1000sqft...$2500 seems more than enough. A/C, I just put in a 2.5 ton Trane for $3900, with only 1000sqft you should be able to get away for much cheaper. Countertops and backsplash seems cheap to me, but depends on sqft and material..are you doing granite/quartz..good price if that includes bathroom too. If that is laminate tops, than its too much. Full plumbing..what is that entail..are you on slab, crawl or basement. Again I can get a full repipe on slab here for right about $5k, on a 3 bed, 2 bath. Bathtubs are about $200-300, custom tile..maybe another 700-1000. so that seems wayyy off too. Cabinetry seems okay, but depends on all wood..soft close..crown molding, how many boxes...Electric seems high for that small of a place, that is more for a 3/2. Windows should be $300-400 each installed, maybe more since supply shortage and demand, but how many windows do you have in a 2/1?, that price seems ridiculous.

Like I said, I don't know your market, but seems like they are taking advantage of you or your market is just very expensive. Either way, get a full scope of work, do draws and get a lien release when you're done. Good luck!! Keep us updated.

@Patrick Hamlin I lived in Cleveland for 10+ years and now in Orlando for over 20, so I know both pretty well also and agree with your cautious approve with your capital. I own properties in Ohio and Florida, a couple I have yet to see. I am more comfortable with this since I've done it a few times, but by no means immune to mistakes or misjudgment that can/have cost me money.

Getting a good team on the ground is important and I'm sure you'll get plenty of responses with the 'big 4'  etc, but, yes depends on your risk. I will only invest in certain neighborhoods that meet my criteria so lessens the risk. Property management is another hot button here, so you'll get differing opinions on that too, but would suggest that you at least run your numbers with a PM in place just in case you ever want/need to switch to one, the cost is already factored in.

One thing I do is hold my properties in land trusts so my identity to the tenant is now known. So if you MUST visit the property, you can say that you are just someone the works for the trust doing an inspection etc. I typically don't advise you get to know the tenants for various reasons...but that's me.

Good luck in wherever you start!

@Michael Johnson I'm partial to Orlando for a host of reasons beside living here. We have a central location to the entire state, an amazing International airport, cruise ports, theme parks (of course), great growth, easy access to east and west beaches, every kid in the world knows where Disney is AND wants to go there. Orlando was literally built for tourism and already has specifically zoned areas and great resort communities with proven track records without the fear or local authorities or an HOA to take it away.

Happy to dive deeper into this with more specifics if needed, but hope this has some value! Happy shopping.