All Forum Posts by: Matthew Forrest

@Greg R. I've had great appraisals and always try to network with the appraiser. For the ADU appraisals I have had (one ADU with multiple appraisal attempts) the comparison isn't between the ADU and interior square footage, its was between the ADU and something extra on the property like a massive shed or a pool. I got $35k for a 700 sqft ADU so $50/sqft. I'm not upset about it... the cash flow is good, but no more ADUs for me until the appraisals are changed.

@Jonard Lopez It might be helpful if you provide your location. Often times there might be a specialist in your area that'll be your best option.

@Brittny Kenaley Sounds like an awesome project! Have you engaged an architect for the build yet? In my experience, getting an architect that familiar with the jurisdiction and works in the area is a key to a smooth build. Also, it’s likely that they will have contractor referrals for you to get bids from. Good luck!

@Clara Settje I haven't personally purchased any rental units in the City of Los Angeles (LARSO has successfully scared me off so far), but I did have these questions figured out a few years ago. I would bet that your ADU is exempt because I assume that it was built recently. The front house is now one of multiple single family dwellings on the parcel which suggests to me that it not exempt, but I don't remember the impact of whether or not you partially owner occupy. Your best bet would be to call LAHD and follow up to get the answer from them in writing.

@Brendan M Loftus Hey Brendan! Good to see a local flipper in the South Bay! I current flip in Torrance and Redondo Beach, but I am looking to add some properties in Manhattan Beach and PV.

Structuring the partnership: Depends on your experience and what you're brining to the table (connections, cash, qualifying for the loan, etc). Obviously everyones financial position is different, but I would consider financing the rehab as well especially if its your first flip. You can always use your cash for reserves.

Incentivizing Contractors: Everyones here to make money so structure your payment milestones so that they are incentivized to work. Don't be afraid to fire fast and early.

PV Nuances: I have no no experience with this, but you should start by calling the city and trying to get a lay of the land. What are permit review times like? How long will it take an inspector to come out? What are the construction rules for the city (time, days, etc)?

How great is PV: I'm definitely biased on this one, but I think PV is the greatest place on Earth. Sounds insane, but where else can you get those views, with that privacy, lot size and price point? Once upon a time MB was my end all be all, but now I'm all about PV. 

@Lauryen Valentino Hey! Where are you looking for the work to be done in LA. I might have some people I can connect you with. PM me for more information.

IMO the bubble is in the USD, but that's not allowed to pop so everything priced in dollars goes higher.

@Rob Massopust Wow this project looks great. Could you share some of the numbers? Purchase price, Capex, rents, etc?

@Jacqui Fournier Even if the ADU turns out to be a good return when looking at the ARV, you'll find that the permitting and build process will add a lot of time. The added cost from the longer hold time can be killer so be sure to accurately estimate your holding time.

@Jimmy Chu I expect that you've already rented in by now (congratulations!), but I'm surprised that no one responded to this. It sounds like you have a perfect lot layout for an ADU which will make it even more desirable.

I don't know about the legality of allowing tenants to bid on the apartment, but it's definitely not the norm. I like the idea of variable pricing for items that are in high demand, but I think you know should know your market and know what your property should rent for. It's always a range, so I would figure out what that number is and decide where in that range you want to be (higher end with max rents and higher vacancy with tenants leaving for better deals, lower end rents that's sticky for tenants or somewhere in the middle). Personally, I keep rents just under market to minimize vacancy, but if your interest from qualified (important that you distinguish qualified applicants from random people responding with a click to your post) renters is more than three in the first week, your price is probably too low and you should just raise it and check if the applicants are okay with it.