All Forum Posts by: Sam Barnsley

Quote from @Dave Stokley:

Well right off the top I can tell you that I wouldn't have made an offer on a property that I hadn't already analyzed and decided I actually wanted to buy. Personally I think that's not cool. But hey that's just me.

As for your actual question, no, I would not buy a $330k property that grosses $50k because there are much better deals than that. Furthermore, I dislike long rehabs because that's a bunch of carrying costs plus time I could be on market piling up $ and reviews (but without an ARV it's hard to evaluate that argument).

Hi Dave - thanks for your response. I had run the numbers on this, but did not anticipate some things that came up in the inspection. Would not have made an offer without running the numbers. If, and a big if, market stays around where it’s currently at, the ARV would be mid to higher 300s - probably 360.

I hear you with the long hold costs! There are other factors with the location (walkable to beach, on a trail etc) that are a plus/could increase revenue.

Hey Y’all.

So I'm under contract on a potential STR in Michigan and I'm looking for input. We are under contract at $215k but anticipate having to spend $115k+ to fix it up to a high standard for a higher end STR. My issue is deciding if it's worth the investment. Works out around a 7 Cap. (20k-25k/320k all in) this place needs a near total gut with new roof and landscaping.

My worry is that we don’t get the projected occupancy rate and being in a very seasonal city it adds risk. Not wanting to do all this work for very little return.

Purchase: 215k

HELOC: 150k (downpayment and reno over 6months)

Revenue: ~50k per year

Profit: 20-25k

What would you do?

Thanks!

Hi BP Fam! 

I’m looking for recommendations/help with figuring out financing for a deal.

I have found a home to purchase to use as an Airbnb. The home is available for around  200k+ and  in need of around 100k in renovations. 
 

Will a lender use the potential STR income as my income to qualify for a mortgage? If not I may be SOL. The plan was to pull a HELOC (we have up to around 250k), put down 25%, then do the reno for 100k and be all in around 150k.

Without the STR income, DTI is around 51%. With the STR income, DTI is around 37%.

Thoughts on options/alternatives? Are there STR specific lenders?
TIA!!

Hi BP community. I’m wondering if anyone has any insight into how much a plot of land closer to downtown Acworth/Lake area will set me back? Not looking for a huge lot, just enough to build on. Also, what is the current rate to build a mid-higher end home per sqft? Thinking hardwood floors, stone counters, tiled showers etc.

Thanks!!

Sam

I think like most folks I've started out excited about the potential of having that extra cash in the pocket in a few years time through REI, but I feel burnt out without even having my first property and I'm finding it harder by the day to find deals that make sense.

Part of the issue is finding where I want the property. My local market and surrounding area is extremely inflated and there is no way to make the numbers work. I’d consider renovating a deal up to two hours drive away, but all neighbour city’s/towns are what I would consider lower income areas with little to no growth or Airbnb potential. This has driven me to consider selling up and moving towns, but this causes additional stress and anxiety as I LOVE where I live in MI. Another option would be to “snowbird” and head south for a few months to renovate and rent, but will be tricky with daycare etc.

Any advice for out of state investing / not getting burnt out / general advice?

@Isaac Gwin I totally feel your pain. I’ve been priced out of purchasing locally as the numbers aren’t even close to working so we’re looking elsewhere. Deals are harder to come by but they are out there for sure. Keep on looking!

@Keith Rocha thanks Keith! I’d need to know a little more about the area before jumping into a deal but definitely interested in learning more about the local area. I spent a lot of the summer of 2013 down town playing for Chattanooga FC but didn’t get to see a lot of the city/neighbourhoods. If you have any connections I’d appreciate it.

Hey @Pat Heidingsfelder - thanks for reaching out. Definitely interested in knowing more about the market down there. I know the area a little (have friends in OS & Long Beach), but not enough to just dive in. If you have time to chat I’d appreciate it!

@Berenger Greer thanks! I figured Woodstock would be a long shot - I love the area and have a lot of friends around the area (I attended Reinhardt). Seen the area really grow over the last few years.

Hey BP!

My wife and I are a couple flips deep in Northern Michigan but looking for a market to start investing in (in the south) to potentially escape for the harsh winters. The plan would be to spend Jan-Apr in the south then STR the house the remainder of the year. The market is WAY too overpriced in Traverse City to make any money.

I've lived in both Woodstock, GA and Hattiesburg, MS so I know those markets a little more than others. Looking for a town with lower cost of housing/ability to BRRRR for both STR and long term rentals.

Cities we would like to know more about include (but not limited to) Hattiesburg, Ocean Springs, Mobile, Orange Beach, Montgomery, Auburn, Huntsville, Chattanooga, Knoxville, Anderson, Columbia, Savannah, Greenville.

Any information you have is greatly appreciated!!

Thanks,

Sam