All Forum Posts by: Nathan Hayes

I had this interaction with someone I followed by mistake after adding my company profile to Instagram.  I noticed after he acted suspiciously that his handle was biggerpockets_.  It's easy to miss the underscore.  Watch out for scammers, folks! 

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $360,880
Sale price: $505,050

This was a full cosmetic rehab. In retrospect, I had complete attic and crawlspace access, and could have done a better job on the rehab with updated wiring and plumbing to eliminate the old-school romex and galvanized plumbing.

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

Purchased from wholesaler - blind bid.

How did you finance this deal?

Hard Money

How did you add value to the deal?

Full cosmetic - Floors; paint; appliances; kitchen & bath.

Lessons learned? Challenges?

Track expenses and expenditures better. Hire contractors that act like professionals and make suggestions (such as the plumbing and wiring mentioned above.

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

James Brown- Check him out at https://www.realhomesolutions.org/

Keep in mind that November applications are typically down as few people want to buy and move in December.  Higher rates have reduced the number of refinance apps as well.  I'm not ready to panic yet, as the new year will bring new applications.  People will take cash out to pay off the credit cards they run up over Christmas.  People will start getting ready to buy and move again.  Houses were selling in the 80s with interest rates we wouldn't accept on a used car these days.  To paraphrase Jeff Goldblum in Jurassic Park...  The market always finds a way.  

Smart investors will make money in any market.  

@Trey Hedrick, I don't know if it's still going on, but for a while, a local CU was offering a 80/20 program where the 20% was no interest financing.  Not sure if that was Denver CU or CU of CO.  Worth looking into as a first time buyer...

@Chaz Heasley, if you've got any properties in the markets you just listed that you're wanting to unload before the bubbles you're referencing pop, I can find you people in each of those markets who will buy them for 15-20% below appraisal right now.  That way you can get out from under that falling sky before it lands on your head.  :)  

My day job is in the mortgage industry and I can definitely see a trend toward another housing bubble, but there will be many corrections followed by more appreciation before we get there.  There are so many factors involved, not least of which is the economic decisions made by this (and the next) executive administration, and how the GSE's respond.  

There are too many unforeseen consequences with so many decisions.  A microcosm example is with the announcement that Amazon is boosting all employees to $15 per hour, and giving a $1 per hr raise to those making $15 or more.  With the stroke of that pen, they also eliminated most of the restricted stock offerings to their hourly employees.  If I had to choose between a $3 per hour raise or 25-30 shares of Amazon stock, I'd take the stock in a second. 

Just some random thoughts...

@Buckner Toney, I just applied online.  The process was slow because I also had to dispute their drive-by appraisal.  Thank the Lord, my day job is as a mortgage loan processor, so I knew how to do that successfully.  I still ended up with a value about $10k below where Redfin estimates my property, but you can only expect so much from a drive by to begin with.  

When we closed after 3 months of processing time, we had to go into a branch, and the manager said it would have been much faster if we'd applied in person in a branch. Based on that, I'd suggest doing that. I felt that the Key employees are very personable and happy to make suggestions to help you out, but they aren't super pushy for you to use their products. I'll be returning to try and add a business LOC as well to fund more of each project on my own and minimize how much I need from hard money or private money.

Some points to consider...

1. Please re-read the articles for the ballot initiative.  The fees are $20 permit application, $20 for the inspection, and $150 for a RE-inspection if you fail the first one.  

2. Renters are already subject to inspection of the property by landlord according to their lease agreements, right?  Most times, you just have to give them 24 hrs notice.  You, or your PM, will schedule the inspections with the city inspectors and give the tenants their 24 hr notice.  For new leases, you write in the permission for the inspections as well.

3. This is clearly an anti-slumlord ordinance.  If you are a good landlord, higher a good PM and fill your properties with good tenants, you should have nothing to worry about.  

It's obvious this is something that will be an inconvenience and you'll write your leases in a way that protects you from having a tenant trash the place to make it look like you're not maintaining the property.  The fees get passed on to the tenant and it's all done.  

If this initiative gets on the ballot and is voted in, then it's chosen by the people as a method of ensuring they have better quality homes to rent.  I don't see how any 4th amendment argument would apply.

I have a Keybank "High-Value" HELOC on my primary that I'll be using to provide the cash liquidity I need to get started investing. Key has some good programs, as their Standard HELOC goes up to 85% LTV and the High Value will go all they way up to 100% CLTV.

As of now, I'm planning to use it to purchase low end properties out of state and if possible fund the renovations.  If there isn't enough for both, I'll look into a hard money or private money lender that will do a low enough loan amount for the given job.

Ultimately, the big idea is to minimize the HELOC use and re-invest my profits back into my own investments so I can begin fully funding my own jobs, or split my own cash into required down payments on multiple simultaneous projects funded with hard or private money.

I'm a new investor. I say that still, as I'm working on nailing down that first property using mostly wholesalers and diligently scrubbing the MLS every day while working my normal job. I'm hoping to finally get the first accept on an offer this week and move forward on that first deal, but it's been hard. Between owner occ buyers that are willing to do their own reno; and cash investors that can afford smaller spreads because they won't have interest payments, Denver is VERY competitive. My offer on the one now is $15k over asking and I'm genuinely concerned I won't get the deal on a property that's been on market less than 3 days.

I've looked at St. Louis due to some family friend connections and cheap flights to check on properties and wondered if I should be looking there.  I've watched asking prices double in the area just east of Gravois Park in the several months I've been looking.  For a while,  you'd see houses available for under $10k, and now I don't see anything under $20k.  Granted, that's still very low.  If I can boost my wife's comfort level with investing out of state, I might just have to look to STL.  @David Ounanian, any interest in partnering on a few deals to help me get her on board with investing in your fair city? 

Thanks everyone for your thoughts.  I appreciate it!