All Forum Posts by: Matt Radhe

Hey everybody, my partner and I are looking to dive into our first fix and flip in Baltimore. While we have some experience in rehab work we would like to hire a reliable GC to work on the project with us. Does anyone have any GC's that they have worked with in the Baltimore area they would recommend? Anything would be appreciated, thanks!

Matt

Thanks @Ozzy Sirimsi, I appreciate the feedback! I agree the area isn't exactly the ideal spot that we're looking for in terms of prime rental opportunities, although I did like that it is very close to the more desirable neighborhoods. I also agree that the asking price of 75k is too high, on that same street there is a newly rehabbed house that was purchased for 50k and listed around 140k now...if we were to go on this house we would have to get it for around that price I think for it to be worth it. I think we are going to continue looking for a more optimal deal but will keep our feelers out in the blocks a little closer to Hopkins. Thanks again!

Matt

Thanks @Rowan Yearwood @Russell Brazil @Ned Carey for the responses, I really appreciate it. I sent a message to Anil Samuel and hope to start taking the next steps soon!

Hey everybody, my partner and I are working up to diving into our first real estate investment- either a flip and sell or a flip and hold rental in the Baltimore area. We've identified a few properties that we would like to explore a little deeper and would appreciate any realtor referrals. We're hoping to network with a realtor that knows the area and has worked with investors in the past and hopefully get started doing deals in the city. Thanks!

Matt

Hey everybody, I'm fairly new to BP but have really appreciated all of the helpful feedback from everyone on the forums as I get closer to pulling the trigger on my first REI. My partner and I are looking at purchasing a rowhome in Baltimore close to Johns Hopkins and a major hospital (Charles Village neighborhood), rehabbing it and holding as a rental. Right now the house is a 3 bed/1.5 bath but if we can create a 4th bedroom in the basement and turn the half bath into a full bath I think we could rent the house out to students for at least $2,000 a month and have a nice cash flowing property. Even if we have to keep the existing floor plan I think we could still charge $1400-1600 in rent for the area based on comps, which would still make this a profitable deal.

Here is the unique aspect to this deal that I could use some help with. The house has already been completely gutted and framed and has HVAC ductwork, plumbing and subfloors already installed (it's essentially a shell waiting to be finished). The purchase price is $75K and comparable homes on the block are valued around 150-180K with a newly renovated house across the street listed for $172K.

The plan is to also use a personal loan from family to secure a purchase and reno loan from a hard money lender, then refinance our invested capital back out once the reno is complete and use the rental income to pay off the personal loan with some interest. 

Here is my specific question regarding this deal:

1. This would be our first adventure into house flipping and we like the specific details of the neighborhood and it's potential but are unsure if the house already being gutted is a benefit or not. Is it generally cheaper to start with an already gutted home and install all of the drywall, flooring, bathrooms, kitchen, etc? Or would be be better off going with a finished home that needs to have floors replaced, kitchen gutted, maybe a wall removed, etc.? We originally liked the blank slate idea of the house but I'm wondering if the material cost for bringing in drywall, ceiling, floor, etc. for the entire house might end up being higher than the alternative option.

I would also appreciate any feedback on the BRRR (is that the right amount of R's) strategy we are looking to employ for this venture. Thanks for all of the helpful insights so far, you guys are awesome!

Matt

Thanks @James A. for the response. I think you made a good point- just because a deal is out in the open doesn't necessarily mean it's a landmine, it could be that nobody has pulled the trigger yet or has had the time to take on the challenge. We're going to take the next step and start talking to realtors and checking out open houses and rehabbed houses in the neighborhoods we are targeting to try and see what works and what doesn't. I appreciate all the input so far!

Thanks @James A. for the advice, I'm definitely leaning towards the partnership route both for the financial reasons as well as the support in splitting the risk/workload. How long have you been investing in the Baltimore market? Do you do rentals or flips (or a mix of both)? And where do you tend to look for deals? I've been spending some time looking at listings on Zillow and targeting rehab houses that have been on the market for awhile (>30-60 days), in neighborhoods that have a close proximity to sought after neighborhoods that will hopefully be rising in home value and with median home values that are at least 1.5-2x the asking price for the house in question. I've found at least 5-6 around Baltimore that really look promising and I guess I'm just wondering if I'm missing something with these properties that make them bad deals...how often do you tend to find a deal in the area that you think is a worthwhile investment?

Thanks @Joaquin Rosario, that's an approach that I hadn't thought of yet (JV partnership). Any advice on where I might be able to find these in my area? I do plan to attend some meetups in the near future and start networking that way

Thanks everybody! That was helpful, I'm going to start looking into the lenders in my area and see what kind of rates I can find

Hey everybody, I'm fairly new to BP and am interested in eventually starting my first flip and sell in the Baltimore area. My cash reserves are somewhat low and so I would like to learn more about the up and downsides of using private lenders and hard money lenders. Aside from having to put 10-20% down to secure the loan, what can I expect to encounter when dealing with hard money lenders in terms of interest rates, points, getting the funds from them to pay contractors/buy supplies, etc. Any advice as to how the hard money side of the business works would be greatly appreciated.

Also if anyone has worked with quality lenders in the Baltimore area I would certainly appreciate referrals. Thanks!

Matt