All Forum Posts by: Sam Foltz

Hi Michael, 

Welcome to Bigger Pockets! My wife and I have built a small portfolio of rental properties in the Twin Cities (mainly duplexes in MPLS & St Paul) I would love to connect for coffee to share some advice!

@Shanna Barnes I agree that hard money may be the best for a flip, but it’s expensive to use hard money and critical to really know all your rehab costs (double/triple check everything). Margins can be thin and deals are scarce, but there is still good potential out there if you find the right deal. I’m working on flips #4 and #5 for 2020 and would be glad to connect with you sometime

@Leticia Montoya

Jordan is correct - you will have a very difficult time finding a contractor to come to your home you don’t own but; depending on how you position it, you should be able to get some bids during the inspection phase. Good contractors are very busy so always try to make the bidding process easy for them. If you can do pictures and measurements for them and get a rough estimate without them having drive to the house, you should have more luck there. We’ve done 4 rehabs in the past year (1 in NE Mpls) so would be happy to chat if you have further questions

I am looking to network and connect with investors who have experience in this market! I am curious to learn more about the rates of returns and types of opportunities available. 

@Jessica Krueger Live a fuller life. Experience more things. Make a difference in people’s lives in big and small ways. Grow through the challenges and conquer the fears we all have. Now that I have young children, before making most of my business decisions, I think about how it will impact the time I have with family and what it can teach us as a family together as well.

@Matt Nettles

I've done both and while I would probably prefer to go the value add route because it creates the immediate equity gain in the short term, I would still go with a turn-key MF if the numbers made sense. I think it depends on how fast you want to grow your portfolio as well what the local market generally provides. If there are plentiful value add deals that you're seeing and you want to grow faster, I'd recommend that route.  In my local market, finding turn key deals that provide great returns is a pretty big challenge so we really have to find creative ways to add value to deals to make the numbers work. 

We've switched pretty much everyone to Venmo. It's part of our on-boarding process with new tenants and we explain it's a win/win. If they don't have it, we coach them through getting the Venmo ("It's pretty easy, only takes a few minutes, and saves a lot of hassle with stamps, checks, running around, etc.") and we just ask them to transfer the damage deposit and first month rent that way. I'd also recommend getting a way to sign all your leases electronically (something like Docusign). Having that  saves us a ton of time! 

@Nick Holty I happen to be a full-time realtor for my day job so just ran a quick market analysis. I'm not an appraiser so my biggest question with this, is how much value is given to a garage by an appraiser. I have comps that support a 250 - 260k value but they have a garage so I'm playing it safe, anticipating a 240k valuation

Thanks! This was a buy, rehab, and hold so all the equity was built in the short term right after we purchased it (~4 months) through improvements. Hopefully we see some additional appreciation, but haven't held it long enough to see much appreciation at this point. 

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $171,734
Cash invested: $171,734

We're applying the BRRR strategy with this. We expect that we will be able to re-finance and pull most of our cash. of the property (we'll probably need to leave ~$8k in), yet still generate ~$350 per month in positive cash-flow. Through the process of renovations (~30k in work doing a new kitchen, windows, cosmetics) we anticipate we will have built ~40k in equity.

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

We love midcentury ramblers/ranch style homes. The one had all the right things wrong with it. We've done 2 already this year and this one was a walk-out! :)

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

This one was on the MLS. It was priced fairly, but was poorly marketed. We were able to get it under contract, and further negotiate a price that made sense to move forward with.

How did you finance this deal?

Cash

How did you add value to the deal?

New windows. Full kitchen remodel. Full cosmetic upgrades to bathrooms and entire home. Exterior and interior painting. Light landscaping and tree trimming.

What was the outcome?

Currently in progress. Will update

Lessons learned? Challenges?

Currently in progress. Will update

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

Yes