All Forum Posts by: Ryan Davidson

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $127,000
Cash invested: $40,000
Sale price: $170,000

3/1.75 with large 4 car garage. Kitchen and both baths completely remodeled. New paint, updated electrical, and plumbing, refinished all hardwood floors and new trim.

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

Originally purchased for primary residence

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

We missed it originally and it had multiple offers, fell out of contract and our realtor called us before she told the sellers that if fell out. We viewed it and offered what there previous agreement was to keep it from opening up to the public again.

How did you finance this deal?

Local bank, 5% down, 3% fixed 30 year mortgage. Used our own cash to remodel.

How did you add value to the deal?

Complete remodel to kitchen and both baths, new paint, updated electrical, plumbing and trim. Refinished hardwood floors.

What was the outcome?

Sold for a loss of about 5k after we decided it wasn't going to be a good fit for our primary residence.

Lessons learned? Challenges?

Do not buy a house and remodel with your wants and needs, unless you are sure it is perfect for you. We would have saved money going into it as a flip instead of primary and using custom cabinets and bathroom finishes.

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

The Real Estate Shoppe in Kentland, IN.

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $115,000
Cash invested: $40,000

7 unit building, 4 completely remodeled 2019/2020

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

Great value add and mis managed by previous landlord.

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

Was on the MLS, my broker sent it to me. Viewed the day after it was listed for 120k, offered 110K we were told they had multiple offers. We increased our offer to 115k and it was accepted.

How did you finance this deal?

Local bank loan, 20% down

How did you add value to the deal?

Remodeled the 2 vacant units, 3rd unit was a terrible hoarder after removing them we remodeled that unit, moved to the 4th and completely remodeled it. As tenants turn we will remodel the others 3

What was the outcome?

We were able to a cash out refi and capture most of our money, continues to cash flow and be a great investment.

Lessons learned? Challenges?

Hoarders can really destroy a property and buying 100+ year old buildings have a unique challenges.

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

The Real Estate Shoppe in Kentland, IN. has the best broker that I have ever worked with. Debby is amazing!

Hello Fellow BPers- I just went under contract on an off market 56 pad MHP, currently at 57% occupancy with infill value add. Purchase price 1,700,000 (seller stated they were given a much higher valuation) Lender also feels like we should get the appraisal back close to 2MM. I have ran all the initial numbers through the calculators and feel its cash flow is good. With cap rates compressing I feel like I have to come off my standard 10-12%. Purchase cap rate would be about a 7% with good value add opportunities. The park is serviced by city water, city sewer, paved roads and driveways. All individually metered water, electric and gas. Currently just 5 POH, 7 RTO with the remainder owner occupied.

We own a couple small apartment buildings, some single family rentals, commercial building and did 3 flips over the last 18 months.  We also manage another 23 pad mobile home park locally and we're excited to add this to our portfolio!

What is the best way to start the conversation with friends and family to offer this opportunity to invest in the down payment?  Are there any private money lenders that would have interest? 

Have a great night

-Ryan

@Caroline Gerardo I will look those loans up and see if they would be willing to share their info. They’re speaking with an attorney now. I am hoping to help come up with a solution that works for them. Thanks for the reply and offer to check it out.

@Matt Devincenzo that was my thought also. I can’t believe that they can keep them “under contract” and not allow sale. I did consider pre payment penalty but that would be easy to navigate. I haven’t dealt with subsidized properties before and didn’t know if being in the program would limit the sale?

Thanks for the reply!

Hello all! I have found a medium multi family that is off market at this time. Owners are trying to sell but, are telling me USDA won’t allow them to sell. Question is why would USDA not allow a sale? Can they keep you under contract? The property does use subsidize housing assistance. I was told their USDA loan doesn’t mature until 2030 and won’t allow them to sell or pay off early.

I just asked about owner carry (waiting on a reply)

Also, what other creative ideas could I use?

@Tamar Hermes

I had 1 vacancy last month and 1 tenant laid off so we were working with him. But to my surprise on the 30th he sent a message that we would have 2 months rent coming in the mail. So April turned out better than expected. I have another that said they will pay by the 8th (which shouldn’t be a problem). 1 more turnover in a different building and we’re looking to fill it within the next week or so. Hoping for everything to stabilize by mid month with everyone paid and no vacancy.

@Hud Floyd

Hello great to see all the responses from so many brothers and sisters. I started volunteering in 2003, moved to another town and worked my way to training captain. Was hired on full time for a few years in SE Colorado as Fire Engineer/EMT-I. Moved back home and rode the EMS bus for a couple more years while volunteering for my community again. Hard to make a living on an ambulance in small town America. Have officially been out of the service for about 3 years now. Real estate has now become my passion over those last 2-3 years. I have 1 SFR, a 6 unit and just finished rehab on a 7 unit. Currently building funds to go for a larger 40 unit deal. Hoping to be full time and "retired" in the next 3-4 years. Currently living and investing in rural Indiana. Stay safe everyone.

I would be interested. I sent you a request. 

@Ashish Acharya Yes we will contact an attorney, I have some rentals now and am looking to increase my portfolio. I was thinking that if they gifted now I would be able to use the equity sooner. While trying to get them some income as well.