All Forum Posts by: Mikhail Petrenko

>Which ADU company are you using?

Just got a few bids

>What are the comps around the area? Are there other ADU's around or near to you?

There a few ADUs and rentals (even neighbors have ADUs). But no comps with sold SFR with ADU.

Rehabbed SFR cost 680-720k in the area.

>What about a JDU on the home already there? 

The idea to add 2 jADU and become an owner of 6 units is viable too)

Done

Hi everyone!

Long time reader, first-time poster.

I found OFF-market property in San Lorenzo (East Bay area). There is 1200 SF 3 bd/2 ba old house sitting on 9000 SF lot with grandfathered duplex zoning.

Appraisal for the property is $615 000. ARV is around 700k.

I can purchase it with cash for 455 000.

The plan is:

- remodel the current home (50-60k) and rent it out, cash-out with 5/1 ARM

- subdivide the existing lot into 2 SFR lots and prepare all plans - $30k and 6 months

- build a first ADU ADUs on the first lot with existing home (700 SF, 2 BD/1BA) - $175k and 6 months

AND build a brand new 1200 SF 3 BD/2BA home - $300k and 6-8 months, rent them out, cash-out with 5/1 ARM

- build a second ADU ADUs on the second lot (700 SF, 2 BD/1BA) - $175k and 6 months, cash-out with 5/1 ARM

Cash flow:

- in 3 months (after the main home remodeling) - 3k/month

- in 9 months (the first ADU built) - 5.4k/month

- in 12-14 months (the second home built) - 8.4k/month

- in 18-20 months (the second ADU built) - 11.4k/month

Result:

I will invest initial 455 + 60 remodeling + 10 misc (taxes etc)

I will have ±975k in loans (to cover new home and 2 ADUs built out - the cost of construction is 650-700k approximately)

I will have 2 SFR with ADUs in Bay Area with ±11k gross rental revenue.

They could cost up to 2 million with 5% CAP Rate.

Please, share thoughts