All Forum Posts by: Ray Hurteau

@William Nohmor 

 I would expect your cost to be roughly $3,000 for upgrading the service, which will require you to put all meters on the outside.  I would further expect you to pay roughly $6,000-7,000 per unit for a complete rewire, depending on number of circuits and lights.  AFCI breakers are expensive, about 5-6x as expensive as the old breakers and 2014 electrical code requires almost exclusive use of them.

can you find someone less expensive, probably.  will they do everything correctly the first time... not sure.  these are the rates we are typically paying when the walls are opened.  it might even cost a little more depending on who buys the fixtures; obviously you aren't going nuts with recessed lights, so my numbers may be a little high.  i also agree with @Richard C.  to upgrade to 200 amp.  i'm not even sure nstar will let you upgrade to anything less and it doesn't make any sense given the fact that your tenants will have more and more electronics plugging into the walls.

Hi Kim,

That's excellent!  Feel free to PM me for more details - I'd be happy to help, especially since it's your first one and there can be so many things to consider.  Hope you are able to make it Saturday!

Account Closed

Smart investors are not investing in places like the one you described (sorry your town is one of the shrinking ones) unless they can find a deal.  Perhaps rentals make sense but flips do not.  Or vise-versa.  There's more than 1 way to make money in real estate.  In general, more people are moving to and living in urban cities. Your town is likely one of hundreds and thousands where population growth is declining. Don't buy something there (or anywhere!) unless the numbers work.

Opportunity? Drive around a town or city where people are moving, where jobs are going. Look around as you drive. I'm sure not every house is perfect. There are places that look like they are falling apart. That's your target. Those can be your motivated sellers and if you direct market to them, you will at some point get a deal. I'm no big shot but it has worked for me on more than one occasion.

One piece of advice: you make money when you buy real estate and that's it. If it's a SFH, there's only one ARV. You cannot influence the market and you can do your best to influence the rehab costs (not recommended, trust me i've tried hiring the cheap people, it never works out), and you cannot influence your borrowing costs (know what they are, as well as legal and all the various closing costs on purchase and resale).

Hi All,

We are wrapping up a 3-family condo conversion in Dorchester, MA (near JFK/UMass) and will be hosting an open house on Saturday, December 13 for anyone local who wants to see our work, network, etc.  We will have light refreshments served and the meeting is being hosted through the Boston Wealth Builders.  The meetup details can be found here: http://www.meetup.com/Networth-Investors/events/21...

For those on BP who are looking for the details of the project and photos not from the area or unable to make it, we will post those towards the end of the year once everything is complete.  We will be staging 2 of the 3 units.

Condo conversions are tricky and we've taken a more active role in this one, acting as the GC.  To summarize some of the challenges: three carpentry crews had to be fired at various times, the city stopped the project once, a dumpster delivery/removal damaged our house and our neighbor's house as well as destroyed the driveway, we almost had a ridiculous roof leak after the board and plaster was installed, the project went over budget both in terms of dollars and timing (although we probably made the mistake of under-budgeting the rehab to begin with), and we learned that even recommended trades from other investors can still not work out, such as an architect who does all his drawings by hand!

I promise I will update this thread with more details once we complete everything and if there are any questions, feel free to queue them up now!

You can also follow our progress on this project and other projects via Facebook (https://www.facebook.com/pages/HRV-Homes/176829259192011) and Twitter @HRVHomes (https://twitter.com/HRVHomes).

Happy Holidays to all!

-Ray

When evaluating rentals I always ask what is my return on investment in years? before tax cash flow per unit? how long am I going to hold it? when putting 25% down, it will take some time to get that money back so you can buy another place. are you okay with whatever that time is? i like the condo idea if the comps make sense, no idea how much work it needs.

thanks @Dev Horn ... just wish had been more diligent before shelling out money for the program. you're probably right about the marketing piece with Dave and Pete. during the event they definitely put the pressure on for you to buy, relating it to a college course.

@Donald Zeller and anyone else considering this course: don't, unless you really want to spend big bucks on things you can learn by reading and trying on your own.

My business partner and I took the course last year... the first free 2 hour session gets you to the weekend "bootcamp" where, just like everyone here states, they sell you the big package.  yup, you're looking at a customer here.

the package sold at the second bootcamp could be anywhere from 20-40k and includes different "courses" they offer.

as of last year, we were un-impressed with the content and after-the-sale support. we did not finish the other packages simply because an agenda could not be sent to us of the topics being covered and we refuse to waste more time and money traveling, staying in hotels, and hearing the same topics covered.  a local FF investor network simply does not exist, at least not through their program.  

anyone who wants to take this investing stuff seriously needs to do their own homework and put in more than an hour a day, which is what is pitched at these events (i can't imagine anyone simply getting a fully operational self-sustaining system in place without any amount of capital or experience-based knowledge).

do we regret taking the course?  yes and no.  monetarily, we always regret bad purchases.  did it kick us in the a$$ to get going and start bringing our investing game to the next level. heck ya!  did we do it with the flipping formula?  yes and no. it taught us about ways to market, but if we came here and did any amount of research, we'd figure it out quickly.

Since we are based in Boston, we had a chance to meet Pete and Dave multiple times and we are sometimes in contact with them outside of the program.  They aren't bad people, I just think they know they can capitalize on their TV stardom and honestly, who among us would not?

ABOUT THE CLASS/COURSE: the other classes they offer include a 3 day secondary bootcamp, a 3 day trip in vegas which literally covers many of the same topics as the second 3 day bootcamp, a special asset protection and marketing thing, and some one on one time with another investor (not likely from your area). after the more personal 3 day course, we would get calls every few weeks to see how we are doing... naturally, success does not come quickly, and then begins the selling of the personal 1:1 "inner circle" which they claim is exclusive, but everyone we spoke to gets the same call... 

and finally, at the vegas event, they do the most ridiculous things, such as a blind auction (to show everyone what a real auction is like)... the amount people were bidding for NOTHING blew my mind. oh, and they also try to get you to pay for more legal mumbo jumbo if you were too lazy to find a local RE attorney in the 3-6 months after the initial courses. they also have "pre-selected" houses for sale in the 40-100k price range and you only need to put 50% down and finance the rest with their partners! you don't get a chance to do any due diligence on the property and you have to assume many of the financial facts you are given.  there is a woman who blogged about her experience here (and about 4 earlier posts on her site) - it's worth a read if you want to know more about the houses being sold at these seminars:  http://flippinginrealestate.blogspot.com/2014/05/b...

the one on one was interesting and useful since nobody else was asking newbie questions and the guy we met with was willing to share his strategy - he does all his investing out of state.

in summary, rather than spend 20-40k on a guru course, spend 10-30% of that on some good old fashioned marketing.  our first marketing campaign covered approximately 2200 addresses over an 8 month period (6 mailings) and from that we completed one wholesale deal which paid for the next 2 years of marketing, one property under agreement to tear down and rebuild (pending city approval), and another property we plan to close on in about 2 weeks.

lastly, if you really want to do a guru course, consider the folks at fortune builders. i did not take the course, nor do i plan on it, but in the various networking events, i've met some of the folks from that program and was way more impressed with that program versus the FF (we actually partnered with one person from that course).  fortune builders seems to have a more solid "after the sale" network... FF does not really have anything

whatever your choice may be, i wish you the best of luck!

Jim,

I would check https://www.rentometer.com/ to see what median rents look like. This is just a starting point. Checking CL is also a good idea and it may be worth reaching out to a RE Agent to pull MLS data. MA has a very strong rental market, you just need to know where your rents will be. Where along the line is it? How loud is the train? Have you heard it from inside the building? Half the year the windows will be closed, so it shouldn't matter too much. My 3 family is near the red line (underground) and my house shakes ever so slightly when it goes by. There is no impact. Typically, being close to public transit is a good thing for those who rent and need to use it, so it should actually be a selling point when you go to list the rental units. Do you have the property under contract?

-Ray

Nick Aalerud - this is quite a story and I definitely commend you for being persistent and not letting the unthinkable stop you from giving it a second go-around.

I think there are a number of us out there (myself included) who have signed up for at least one "guru". However, for me, I would say that had it not been for the course, it would have taken me much longer to realize that networking and creative real estate can be keys to success. Granted I'm still looking to close on my first deal following the course and get out of that 9-5 job...

Excellent advice - stick to the numbers, be conservative, don't get sucked into bidding wars (especially those who are in markets where MLS has dried up again), have a system, and just let the numbers talk to you.

I guess I really opened a can of worms with this topic.. here's what I see when I look up MGL Chapter 64D, Section 1:

Deed, instrument or writing, whereby any lands, tenements or other realty sold shall be granted, assigned, transferred or otherwise conveyed to, or vested in, the purchaser or purchasers, or any other person or persons, by his, her or their direction, when the consideration of the interest or property conveyed, exclusive of the value of any lien or encumbrance remaining thereon at the time of the sale, exceeds one hundred dollars and does not exceed five hundred dollars, two dollars; and for each additional five hundred dollars or fractional part thereof, two dollars; provided, however, that in Barnstable county, the excise tax herein specified shall be one dollar and fifty cents for each five hundred dollars or fractional part of said consideration, excluding a consideration of between zero and one hundred dollars.

The dollar amounts don't seem accurate, so I could be missing some other law elsewhere that I could not find.

If I read this correctly, my interpretation of the above is that the tax is exclusive of any liens. To K. Marie Poe's point, the "deal" would be too thin if this was a sticking point, so I get that completely.

Thinking about this a bit further, say I take over the seller's mortgage and give them consideration of 50k to bridge the difference between loan balance and "purchase price"... when I go to sell the home and have to repay the loan, would it not be taxed at that time? I can't see anything in the MGL that speaks to this... hmmm...

Add it to the list of questions for the attorney. Since traditional home sales don't work this way, I can see why the transfer tax would apply to the full amount, since it's a new loan, not an existing lien being assumed.

I guess we'll have to the weigh the risks of buying the property for a certain price versus assuming the loan. Qualifying for a new loan shouldn't be an issue... Personally, I don't see the benefit of saving a few bucks and needing to hope the banks doesn't call the loan, get added to the insurance policy, hope the seller pays the mortgage on time, etc. Sure, more of the payment will go towards the principle of the existing loan...

It may also depend on their interest rate vs. market rates now... but with rates heading up, the banks may be looking for any subject-to's already out there... one thing is for sure, bank's don't like missing out on interest due to them.