All Forum Posts by: Mike Costello

Investment Info:

Other other investment.

Purchase price: $65,000

120 acres of wildland surrounded by national forest, in the midst of the Dixie Fire (2021) burn scar. This 5500-6000' elevation forest & range parcel is a diamond in the rough. Over the next 5 years we'll tap into USDA and state wildlife programs to completely rehab the grasses, shrubs, deciduous and conifer trees with no less than 4 dozen different plant species seeded or planted. From wildflowers to bald eagles, the forage and critters will be brought back to life.

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

Wildlife needs habitat, and I need more time off-grid! Prime recreational land costs $$$ but burned, scarred and neglected land that is hard to access can be found for a reasonable price. I can't make this property easy to get to, but I can steer the habitat restoration with creativity, patience, and sweat equity.

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

Found the deal for sale in 2022 and stayed close to it for ~18 months. Rode it though some funky seller issues whereby it changed hands between 2 different owners while I had it in escrow (fun!). Set an all-inclusive not-to-exceed price for what I would contribute and waited until the decided it was time to let go. All parties were in TX as well... had not seen the property in over 4 years.

How did you finance this deal?

Private money lender, 100% financing no payments for 30 months, interest only months 30-60.

How did you add value to the deal?

Adding value will slow and heavy on sweat, dependent on cycling through several seasons of seeding, planting, growing. We'll install year-round water for wildlife, forage plants and grasses to bring critters onsite and create an oasis of biodiversity which will compound and spill over to the National Forest lands that surround the property.

Eco-tourism (outfitter tents) for off-grid wildland camping, bird watching, mtn biking, hunting and dark-sky stargazing will bring incremental revenue.

What was the outcome?

TBD... just getting started.

Lessons learned? Challenges?

Anything is possible.

Investment Info:

Other other investment.

Purchase price: $65,000

120 acres of wildland surrounded by national forest, in the midst of the Dixie Fire (2021) burn scar. This 5500-6000' elevation forest & range parcel is a diamond in the rough. Over the next 5 years we'll tap into USDA and state wildlife programs to completely rehab the grasses, shrubs, deciduous and conifer trees with no less than 4 dozen different plant species seeded or planted. From wildflowers to bald eagles, the forage and critters will be brought back to life. We'll restore the riparian zone and install year-round water for wildlife (deer, elk, bear, wolves, and more). Call it a long-hold fix & flip for land, with an injection of wildlife and habitat minded eco-investment. Eco-tourism will be featured, as will sheep/goats/cattle for some seasonal forage management.

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

Wildlife needs habitat, and I need more time off-grid! Prime recreational land costs $$$ but burned, scarred and neglected land that is hard to access can be found for a reasonable price. I can't make this property easy to get to, but I can steer the habitat restoration with creativity, patience, and sweat equity.

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

Found the deal for sale in 2022 and stayed close to it for ~18 months. Rode it though some funky seller issues whereby it changed hands between 2 different owners while I had it in escrow (fun!). Set an all-inclusive not-to-exceed price for what I would contribute and waited until the decided it was time to let go. All parties were in TX as well... had not seen the property in over 4 years.

How did you finance this deal?

Private money lender, 100% financing no payments for 30 months, interest only months 30-60.

How did you add value to the deal?

Adding value will slow and heavy on sweat, dependent on cycling through several seasons of seeding, planting, growing. We'll install year-round water for wildlife, forage plants and grasses to bring critters onsite and create an oasis of biodiversity which will compound and spill over to the National Forest lands that surround the property.

Eco-tourism (outfitter tents) for off-grid wildland camping, bird watching, mtn biking, hunting and dark-sky stargazing will bring incremental revenue.

What was the outcome?

TBD... just getting started.

Lessons learned? Challenges?

Anything is possible.

Investment Info:

Single-family residence buy & hold investment.

Well built tiny-cabin (650sq. ft) with oversized and overbuilt garage (1000sq. ft) on 1/4 acre lot in the highest elevation year-round community in Tuolumne County - Leland Meadows, off Hwy 108 @ 6300' elevation. Beautiful alpine meadow and mountain setting, surrounded by the Stanislaus National Forest - community features small lake, tennis courts, and more.

Plan is for year-round STR, conversion of 1/2 the garage to ADU to double heads-in-beds and add flexible living space too.

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

The oversized garage and tiny cabin made this a very unique property - too small of a living space for most buyers; too much garage build out for the market. I was the only serious tire-kicker on the deal across an 18 month period. I stood in line, alone... until the sellers were ready to make a deal.

The location is impossible to beat for a mountain community and access to year-round adventure & recreation. Quality build with unique features that removed all other buyers.

How did you finance this deal?

10% second home loan though Northpointe Bank - Jeff Chisum & team.

How did you add value to the deal?

See opportunity where others do not; stay connected to the agents and seller while patiently keeping them informed of my motivation to close a deal, and my willingness to wait for the right price.

What was the outcome?

40+ guests in first 6 months of STR activity - All 5 stars, with exception of 2 4-stars.

Lessons learned? Challenges?

Winter at high elevation makes STR mgmt from a distance much more challenging!

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

Jeff Chisum, 10% 2nd home loan professional. Great team.

 Ok good deal, thank you. I've seen some online templates but wondered if that's TOO simple. As the borrower, that probably favors me though. 

Hey there BP community! 

So I just got into escrow for a parcel of raw land, and I'm financing the purchase via a Private Money Lender (friend, colleague). We have a fairly simple set of details to go into the Note, and don't need to make is super complicated.  

That being said... what's a good source for a template? Is it best to have this document drafted by an attorney (and why?)? OR - will the Escrow company (Chicago Title) draft the Note and Trust Deed on our behalf if we provide the key elements? 

I'm the borrower so my perspective is to keep it simple and not as "lender favorable" as a standard mortgage, but at the same time I don't want to skip details which expose my lender to excess risk. Thanks in advance, looking forward to your ideas, experience and perhaps referrals too. 

Cheers, 

Mike Costello 

- Camp Leland on AirBnb

- 2 Dog Lodge on AirBnb 

- Headwaters Retreat (top secret, coming soon) 

Ok... my first RE success was in 1994. I was a recent graduate and still living in a University town in California. I was more excited about real estate than graduate school, so took a chunk of money and bought a recently rebuilt (post-fire!) 5/3 super-rental in that university town. Strategy: I would take the primary bed+bath and 1 other bedroom, and then rent the other 3+2 to a group of students. House hacking isn't new. Purchase price was $145k as I recall. My first 3-4 years in that house I rented rooms out, then when I moved it became a long-term rental with great cash flow. 

If your place in life supports house-hacking...it truly can be a powerful strategy.  

Investment Info:

Single-family residence buy & hold investment in Plainfield.

2 Dog Lodge - Camp Connell. Family friendly and dog-functional cabin in the woods. Vacation rental at the gateway to high-country alpine adventures.

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

This is the type of cabin that we would seek out and use ourselves. Easy access in a quiet neighborhood with true 4-season fun and adventure, with a level yard that's great for families, dogs and friends.

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

Local RE agents; kept close to the deal until the seller was ready adjust to market realities and take our offer.

How did you finance this deal?

Vacation home, conventional.

What was the outcome?

Guests love the theme and the amenities.

Lessons learned? Challenges?

If a buyer pauses and doesn't chase the deal, it's opens up the potential for a deal to chase the buyer.