All Forum Posts by: Scott Nipp

I'm just as new to this as you are, and still looking for my first deal however...  I would say it doesn't have to be an all or nothing proposition.  If you think you will have better luck finding the flip opportunities there and that is something that you want to pursue, then by all means start hunting out those deals.  However, just keep your buy and hold strategy open as you might run into some good options for that in your search for flips.

I think it's great to be able to focus on a particular strategy, but at the same time I am keeping my eyes and options open for other opportunities that may come along.  Personally, my wife and I are really focused on wholesale and flipping but just today I came across a duplex less than 2 miles from our house that MIGHT be a great rental option.  I'm eager to get home in fact to do some more research on it.

Whatever you decide, just keep yours eyes open and don't think that you have to exclude buy and hold just because the market doesn't look great for it.  It may very well be that you don't end up doing much in the buy and hold arena, but I'm sure if you keep looking you'll be able to pickup some over the long haul.

Sounds like a great plan and CONGRATS on the first property.

I've never been to Panama, but I'm looking forward to a cruise that we are taking in the spring and we are going to hit Belize.  Personally, if I were to be looking at something like that Belize is definitely the place I would shoot for.  I know that in Belize English is the national language and it's an incredibly hot real estate market for US expats.  It also has arguably the best diving on this side of the planet, and that's one of the reasons I'm excited about the trip this spring.

Way to go.  Sounds like you got yourself a great deal there.  Congrats on the first deal.  I hope that mine doesn't take me a year to get to.

I think the idea there is to follow-up in about 3 or 4 weeks.  That is going to depend of course on just how "insulted" they were though.  If they just gave you a cold "No thank you" and hung up, I would try following up a few weeks later.  I would also try and confirm that they might still be in the market to sell first though.  If they were more aggressive in their being insulted though, I would probably just leave it alone.  

Welcome Trevor.  I'm also new here and the community has been great so far.  Definitely don't miss out on the podcasts they are awesome and quite motivating to be honest.

I would guess that oil heat is not that uncommon up there.  My thought is to just make sure about who is paying for the oil, you or the tenant.  I only think the washer/dryer in the basement might turn off a few elderly potential renters as they may not be spry enough to handle the stairs but once again I'm sure basement laundry is not uncommon up there.

The numbers look right to me, but it seems a bit thin on cash flow.  If you could get more like $1100/mo on the rent that would get the cash flow up in the $225-250 range which seems more worthwhile to me.  Just my 2 cents.

Looks like I am going to get to at least make an offer on what would be my first deal. This is a FSBO in Fort Worth, Tx. It is a fairly new neighborhood with most of the houses being built in the early to mid 2000s. There is still some limited construction going on in the neighborhood and new construction about a half mile away in the same general price point for these houses.

Here is what I have up to this point. The guy told me that he could list the property for about $140k but he is relocating to TN and needs to sell fast so he is trying the FSBO at $125k. The property is a 4/2.5 2 story (2178 sq. ft.) built in 2004. From my not so expert eye it looks structurally sound and the A/C looks really clean so I'm guessing that it's in pretty good shape. The roof looks good and no signs of any water leakage on any of the 2nd floor ceilings.

Now, it is missing 2/3rd of the back fence and the remaining 1/3rd is in pretty bad shape.  The inside absolutely needs paint throughout but I think the flooring on the ground floor could work being in pretty good shape though the kitchen is linoleum and the rest is a rather low grade hardwood laminate.  The upstairs is also linoleum in the 2 baths and the same hardwood laminate in all but 2 of the bedrooms.  Both carpeted bedrooms need to have new carpet.

The kitchen seems to be a mess with 3 missing drawers, no idea how those could be replaced so I'm guessing new cabinets are probably necessary.  The counters are cheap formica with some swelling in the 9- degree seem in a corner.  Appliances are all black but is does have the benefit of a huge walk-in pantry/laundry area.

Comps in the area are all over the place. They range from $46/sq ft all the way up to $84/sq ft with the average being in the mid to upper 60s. This gives me a ARV of somewhere between about $105k and $170k, which is obviously a ridiculous range. I think the most realistic comps come from that street in the past 4 months at $60 and $65 getting me in an ARV of about $131k to $142k.

Working with the middle of that ARV...

ARV = $136k

70% rule = $95,200

Estimated repairs = $15k

Misc expenses (10%) = $8k

Wholesale fee = $5k

Max offer = $67,200

Honestly I think if I offered the guy $67k I would suddenly be hearing a dial tone.  I really don't think this is a possibility for a flip.  However, I wonder about the possibility of this being a workable rental.  I'm really not good on the numbers for that side of things.  I believe that the repair costs could be reduced to just paint and re-carpet the two upstairs bedrooms if drawers could be found/made to match the existing cabinets.  I'm guessing maybe $7500 on the repairs.  I would still like to get the $5k on the wholesale fee and I doubt that the misc expenses is going to change much.  So targeting this as a wholesale to a buy & hold rental landlord gets me where?  Does the 70% rule still apply to this situation?

Rents in the area for this size and bed/bath configuration are going around $1300 to $1450 per month. Property taxes are about $3500/yr and the HOA is I believe $300/year.

So...  Where do I stand?!?!  Thanks in advance for any feedback, recommendations or suggestions.

Sounds like a heck of a weekend, but looks like you at least got some good news at the end of it.  Good luck with getting the other side filled.

 Not that I know of.

Yes to all of the above.  We are most specifically focused on the Saginaw, Lake Worth, Azle areas but also north up to Haslet.