All Forum Posts by: Natalie Cloutier

@William Coet yes sorry in Canadian currency!

We have a loan with a private lender for 9% interest. Closed loan for 6 months then open to pay back whenever. For a total amount of 504,000$ but we borrow in progressive draws so we only borrow what we need basically as the construction progresses not to pay interest for nothing. (We borrowed 150k for 4 months and now we’re at 300k since 2 months) Once it’s done we could get a mortgage for 80% of the full value which we’re estimating to be in the high 700k (Waiting on final evaluation to confirm actual value) & we’ll get a mortgage for just what we need: Enough to pull out a mediocre salary but not too much to make sure we still cashflow nicely every month.

@William Coet thank you! :)

Land costs depends on the project, location and if a septic is needed or not. Usually about 100k or so once we have everything ready to build.

The rents for the Fourplex: The top units are 3 bedrooms, 2 baths with a garage and a backyard and rent for 1,600$+utilities+appliances (we never supply appliances). Bottom units are basement units but they’re half outside the ground so they have large windows and are 2 bedrooms, 2 baths and rent for 1,250$+utilties.

My husband acts as a GC and does a lot of the labor work himself: electrical, insulation, drywall, flooring, kitchen installs (ikea), painting and everything else in the finishings. Everything else we sub out. :)

@Sandra S. to be honest we don’t use any type of calculator we just know our costs really well and we use a spreadsheet and compare with similar projects we’ve done. My husband use to be an estimator so its really easy for him to estimate costs once we have a design done. He’s usually right on point once we compare with the actual estimates from the trades.

Sorry if this doesn’t help you too well :(

@Greg Dickerson every building is different depending on the number of units they have. The Fourplex we're building now will have an NOI of around 1,700$ a month where our duplexes probably have about 500$-700$.

You’re right about the systems thats what we’re trying to organize now :) trying to go on autopilot as much as possible!

@Allan Smith yes we don’t find its worth it anymore for Single Families. (Although we’ve always cashflowed positively and always pulled a good salary from the constructions) but Multi Families are where its worth it!

A lot of people ask us why we build new instead of renovating and I just wanted to share a few reasons with you guys to get your thoughts!

1. We have complete control over the budget from day 1

2. Finished value is always far higher than our actual costs to build

3. My husband quit his job at 25 to build full time as he’s able to pull a salary from the budget by doing the labor himself

4. Purposely built buildings, better layouts, functionality and overall designs (I do the architectural/permit drawings myself)

4. Energy efficiency (low utility costs for the tenants)

5. Low maintenance

6. We know exactly what’s behind each wall

There’s a whole lot of other perks that for us just make the most sense and I know building new doesn’t work in every market (like markets where the value of the homes are just lower than what it would cost to build) But I’m curious to know what you think since I don’t see a lot of investors taking this path.

Also, any pro builders out there have any tips for us as we grow our portfolio?

@David Smith the loan is a total of 450k but is made up of progressive drawbacks (goes with how much work you’ve completed) so we dont have to borrow the entire chunk at once.

@Rich S. so the Fourplex we’re building now should cost us about 510k but has been evaluated in the 700s & We’ll have a monthly rental income of 5,700$/month (tenants pay all utilities). We’re building with a private lender and once done we’ll be able to pull out all the money we invested in it + a good profit with its new value at 80% and reinvest it.

@David Smith I understand that for sure! if you're just buying and doing nothing then yes. But if you're comparing the BRRRR strategy to New Build it can be about the same depending on the size of the reno and how organized you are as a contractor. We built a duplex in 3 months last year. And we don't stress anymore we actually love the process!

@Rich S. yeah I think it depends a lot on the market! Here values are high and we do a lot of the work ourselves so we can always build way below market value. We’re building a Fourplex right now that should cashflow about 1,700$ a month and we’ll be able to take out quite a large chunk of cash when done!

In our market if you buy its old and rents are low and its tough to get people out but with new builds you can rent for higher and you can fill the building yourself.