All Forum Posts by: Sean Rooks

Boston is a desirable travel destination, maybe you can factor in AirBNB for your multifamily and see if that makes the numbers work. 

LT Caplan is my preferred. Also Shawheen Lawfirm has a few that a lot of BP members use. 

@Charles Holder

I used a Real estate agent to close the property, but I found it on Zillow. As for the calculators, yes you can see on the original post I used my own calculator for the initial and the BP calculator for the actual final numbers. For estimates, yes you will need to have a contractor (or 3) come out and do a walk-through to get a rehab analysis (usually these are free). As for the inspector, yes I would recommend getting one once your offer is accepted. Its worth it when you are starting out and don't know what to look for. I've heard of more experienced investors skipping this step once they have a few under their belt. 

@Amy Bai

I used a conventional mortgage. The loan covered the purchase of the home, I used private money and my own money to fund the rehab. As for the electrical and plumbing, a lot of it had already been replaced and upgraded, so most of the rehab was cosmetic, but we did have to add quite a few new outlets and replace some cast iron plumbing with PVC. 

@Jacob Miller

PM'd you

@Charles Holder

I found it on the MLS actually

@Clint Bronder

Yeah I actually didn't realize I was doing it differently than most until about 1/2 way through. I think primarily this technique is not talked about much because usually for a BRRRR to work the property needs to be in rough enough conditions that a bank would not loan on it. Luckily this one was right on the edge with some broken windows that had to be boarded up prior to closing.

@Eric Kulling

Eric, you are correct. My BRRRR was a little non-standard. Since the property wasn't in horrible shape it qualified for conventional financing. In this case you have the option to pay cash for the initial purchase or get financing. Financing made sense for me because of the long turnaround for the rehab (moving tenants around) and the lower inital investment required. Though I incurred some interest cost, my cash wasn't tied up for a year. Then at the refi I was able to pull out my dowpayment and a portion of the rehab. A home run would be paying yourself back completely or even making money!

Not to brown nose, but I need to give credit where it's due!

I am 100% confident this would not have happened without BiggerPockets. Specifically the BP Podcast. So thank you @Joshua Dorkin, @Brandon Turner and all the BP staff for making BP what it is, podcasts, webinars and the tons of free education available here. You made me successful.

@Brandi Graham

Yes exactly!

@M Boyd

The bank I used was a portfolio loan, but conventional not commercial. Typically convention will focus on personal finances. Commerical will focus on the asset itself. Cons of commerical are the typically shorter loan length and typically higher rates.

@Danielle Sheridan

For ARV calculations: I would recommend using an investor friendly realtor to run it for you, then after you've seen a few you can probably calculate it yourself, if you have MLS access. Just remember there are multiple ways an appraiser can determine value ($/sqft, $/room, and $/apartment) for small multifamily.

@Kevin Sack

@Kevin Sack

I do not, otherwise I likely would have used them! The best I know of is 75% around here. If you run into anything higher, let me know. 

@Eric D Larson

@Eric D Larson

Its simply a rough Rule of thumb for an initial look at a property, to see if it warrants a full analysis or showing. For example, we replaced everything on this property except for roof and siding (already completed), so using the $45/sqft and a 2350sqft house, that equal $105k reno. Now we only spent 85k total. But if you added siding and a roof, It looks like that ROT is pretty close. Once you see if the property is a possibility, then I would nail down the rehab costs with some contractor bids. 

@Krissie Cole

@Krissie Cole

I haven't, but thats a fantastic idea I've heard mentioned on the podcast! 

@Nate Ginsberg

@Nate Ginsberg

I did stay away from Portsmouth, you can search on BP about problems with Portsmouth government. However, some people are successful there. I wrote down about 30 addresses of for sale properties in all of Norfolk and Chesapeake then drove by them all, getting a feel for the neighborhoods. This one seemed to be in a quiet area with many other rehabs and new builds. As for Richmond, I'm not sure! I haven't looked there yet, but it sounds like some people are successful there. 

@Aaron OCallahan

I am local to this market. I use a Property manager, as it worked for the numbers on this one. However, I do manage a SFR. This is just because of the class of tenant in each, and the tri-plex requiring more attention than I could give with a full-time job. The SFR seems to requires very little of my time!

@Jay Dang

@Jay Dang 

Yes, or using it to pay the contractor directly. 

@Rachelle Duron

I analyzed about 100 deals before this one. Basically to get a feel for the market and what was selling. A tip, analyze sold deals at first to see cap rates and CoCROI, then once you see a norm, analyze for sale deals. Then once a good one pops up, offer on it, or go see it then offer on it. 

@Tuvia Goldstein

I used a traditional bank, the seasoning require was 6 months, but I was at 12 post rehab. I was able to get a 30 year fixed at 4.75%

@Patrick Menefee

I was fortunate to be able to use some Private money for the rehab, I also funded the other half with 0%APR credit cards. Not a huge fan, but it worked in this case. 

@Danielle Sheridan

-  By "off market deals" I mean, getting any steeper discount at the purchase I can. That can be using a wholesaler, sending out direct mail, or possibly even cold calling landlords in the area. I'm planning on trying all three. 

 - As for the rehab estimate: I heavily relied on Jay Scotts book "Estimating Rehab Costs" and used that to figure it out. In this area another good Rule of Thumb (ROT) is $45/sqft for a heavy rehab(replace everything), $35/sqft for medium(between the two), and $25/sqft for light(paint and carpet