All Forum Posts by: Sarah Lorenz

@Kit Klekamp This is funny--I just went to the open house for one of the newer duplexes on the block. I saw your place--you must have just closed on it. Those up-down duplexes are pretty ugly, but I know of at least one that is all updated and getting something like $1795 for one unit. And there is one near the Stadium that is fixed up really nice--the best design I've seen. I think it is on either Hutchins or Prescott or Edgewood as you turn north off Stadium. Try to take a look at that. The washer/dryer in the kitchen is a real downside and limits the rent a bit. 

You'll have to decide if you want to do a teardown or not--you probably don't want to put any money into it now, if that is the case. The demolition itself can be expensive, as well as digging a new foundation and hauling away the dirt that is excavated. That actually adds significantly to the build cost. But there could be profit there--we'd have to run the numbers. I could help you with some general numbers--most architects won't estimate costs for you. Most builders won't either! They'll want you to give them a plan and a budget and sign a contract. It takes weeks to bid out new construction. You have your comps right next door so that helps. The question is whether or not you can qualify for a construction loan to do it, and find a builder for the right price. I don't think you could use hard money for this--the numbers are too big and it would eat all your profit. And kill you if your projects runs over on time, which is common. But shoot me an email--we've done something a bit similar, so I can give you some ideas. 

We are planning to move into new construction soon (my husband has a builder’s license), and as opposed to building a spec house and waiting until it is finished to sell, I have heard that some builders/investors will market the house prior to construction, get a purchase agreement, and then have the client fund the project. We would own the property. I’m looking for any advice from others who have done this. I suspect it may be difficult to get a bank to fund a construction loan with a builder who does not have a long track record. I’m also wondering what might be a typical down payment with a purchase agreement, and any other advice anyone can offer.

I am getting ready to purchase a new primary residence, and I have five properties that I’m considering, which have been on the market for a very long time because they need major rehab or a teardown. I am considering putting in low offers on all of them simultaneously to see who might be willing to lower their price, but I have never done something like that before and I am looking for any advice on strategy. I was thinking I would inform everyone that I was submitting multiple offers and include a 24 hour response requirement.

I have a significant amount of short term rental income on my primary residence this year, which is the only property that I currently own. I will be selling it in 2018 and buying a new primary as well as an investment property. If I have a similar amount of rental income in 2019, will a lender simply see that similar amount and then count that as a two year track record of income, or will they notice the different properties and want to see a two year track record with the same property?

Here is a very informative article from the Detroit News a couple days ago--a broad overview of what to expect/watch for in Metro Detroit and Michigan in 2019.

https://www.detroitnews.com/story/news/local/michi...

@Nik Moushon

Yes, it is a bit much. I think I watched two episodes and then fast forwarded through some of the others just to look at their places. It was pretty hilarious, however, when they got to the home of the young newlyweds, who work as a yoga instructor and a plumber, and live in what is clearly a million+ estate on the Pacific, and they were all whispering, “how in the heck can they afford to own this place?”

I thought it was interesting how people decorated their places so much to their own taste and then drew a clientele that also liked that style.

Will do, thanks.

@Michael Greenberg I meant to reply to your response earlier--can you elaborate on your strategy for the higher end STR investments? I'd like to hear more. That is where I am with a 4 bedroom house and a high nightly rate, I think. But this is my personal residence I'm using right now. I'd like to hear more about how others are doing this strictly with investment in mind.

Update: There is another new STR show on Netflix called "Instant Hotel" which is set up like a reality show in Australia. They have 5 couples who already successfully rent their homes do a tour all over Australia and rate each other's STR. Then the winner gets some prize. Plus they have a hotel expert weigh in. In this one, the group also goes out to try the local attractions that the host has recommended, so that is interesting. It's entertaining and obnoxious. The hilarious thing is that they all leave ridiculous welcome baskets that probably cost $100 each.

Lots of great ideas--thanks! @Paul Sandhu I like the garden idea. The shooting range in downtown Ann Arbor--hmmm, probably not, on several levels, but possibly hilarious for the shock value. Great ideas for entertainment, @Paul Sandhu and @Michael Greenberg. Two sinks in each bathroom is a good tip, easy to plan for a new build. @Kathy Hansen I wonder if separate en suite bathrooms for each bedroom would be worth the cost? Vs. a jack-n-jill set up for every two bedrooms? The main design I'm looking at would be a two story house with a finished daylight basement, and two bedrooms on each level, for a total of 6. I'd be aiming to have maximum longterm flexibility--rent the whole place for events while we travel, rent the lower level for a nightly STR when it suits us, or turn 1-2 of the levels into a LTR later on if I get sick of the STR gig. So yes, separate entrances possible and the ability to lock off each level, but designed so it looks like a very nice single family home. We can have ADUs here, but you can't use them for STR. But you can for your primary residence, so I'll want to keep it like a single family, I think.