All Forum Posts by: Sean Walton

@Matthew Hamilton you are still young so while everyone is correct that having less than 2 years in a field will hurt your chances of getting a conventional loan I would never tell someone to stay at a job that makes them miserable. You can try getting seller financing if you find the right deal.

If you can find another job you like better e.g. construction, property management, real estate agent that allows you to learn some aspect of REI and is close to the income you are currently making with better hours seems like a win win.

In the mean time listen to podcasts and RE / Business books on tape (many can be borrowed from your library) to make your commute useful time.

Hi Matt, I'm not an agent but in speaking with agent friends, you usually make very little money your first year but if you hustle a lot you might make some money your 2nd. Can you move back in with your folks while you get established? Also keep in mind agents don't make w-2 income they are independent contractors which makes it tougher to get loans. I think having MLS access is great and some agents are killing it but times are good in most areas. If we hit a correction, new agents will have an even harder time getting commissions. Is your goal being an agent or an investor?

@Ethan Cooke I don't have enough knowledge about A&B to really say definitively. It seems like rents have softened lately but depending on your cost of construction, it could pencil out either way. I would look at comparable TIC and rentals in the area. Time of permitting and construction I would ask your architect since I haven't done this kind of project before.

As far as airbnb you are close to SF state, and City college so you could get some visiting professors and people who are on a tighter budget and can't afford to be more central. It seems like a lot of people on BP are surprised by how well they do on STRs in non-touristy locations. I get a lot of people relocating for work and their company will rent it for a month to get them established, but I do 30 day mins to comply with the STR rules.

@Ethan Cooke from Nolo:
" 90-Day Rule

The law limits rentals where the host is not present in the unit to a maximum of 90 days per year. Violators who continue to rent out their apartments beyond the 90 days are subject to a daily fine of $484 for first offenders up to $968 for repeat offenders.

“Hosted rentals”--rentals where the host is present in the unit--are not subject to this limit."

My interpretation (I'm not a lawyer) by in unit they mean the same dwelling unit. If the inlaw has a kitchen it is a separate unit. The goal of the airbnb law was to get more unit to stay in the rental pool so they probably don't exempt in-laws from the 90 day rule

If it is just for airbnb purposes guest may not need a full kitchen just a coffee maker, toaster, microwave that may be a way to skirt things?

Is the place not currently rent controlled? If it was built after the cutoff date I think it will be easier to condo convert but not my area of expertise.

@Robert Grunnah I'm 2 months into the @Michael Quarles coaching and about to send my first mailing out. He says some people like Coke some like Pepsi. The post cards tend to attract a higher percentage of motivated sellers where as the professional letters get more tire kickers wondering what their house is worth and not necessarily motivated but they both get results. As long as you are tracking things and the letters get enough results to justify using them I say keep cycling them.

If you are low on cash I say your mailers are most important. If you have a spare $297 and a website will make you feel more legit you can go to https://www.yellowletters.com/product/real-estate-website I got one and it's way less than a webdesigner will charge you. You can ask them to put your logo and update it as needed. If you have more time than money you could try and make your own on weebly, squarespace, etc but that probably isn't the highest and best use of your time

Hotels have many rooms onsite and usually set prices so that a few are available for last minute bookings so they can afford to have you cancel with 24 hour notice and probably find a replacement so they are ok charging on arrival. Most airbnb hosts only have 1 or 2 places so a last minute cancellation can mean unpaid vacancy. 

If airbnb doesn't take the money upfront you could cancel the credit card you booked with then cancel your reservation and they would have no recourse other than banning you from the site. If a host has their refund set to strict airbnb would have to pay the host or risk losing that host to another site. 

If you do a multi month booking you will only be charged for the 1st month and the next month about a week before it starts.

My mom pays about $2200 for a 2/1. I haven't done any other market research on rents but the is about a 0.5% rule. I think with HOA fees and mortgage payment, maintenance and capX it would be tough to cashflow as a typical rental but it is close to downtown and the boardwalk so you could airbnb it if there are not CC&R prohibiting it. Although I wouldn't count on a deal if it only cashflows as a short term rental since regulations can change.

If you can confirm first with a broker's price opinion, that it is worth $120k and he is willing to sell for $80k you could wholetail it. Get it under contract to buy then do home inspection and appraisal and confirm again it is worth $120k if not negotiate him lower. Then buy it subject to his loan. You take ownership and a title company gives him a note stipulating that you will make the payments and if you don't he can foreclose on you and take back the property. You will take over making payments until it is sold to a buyer at the full market value of $120k but you will have to pay all the inspection, closing, realtor costs but it is still a good payday for you. Buy buying it sub2 your holding costs are lower than hard money. In the unlikely even the bank calls the loan before you are able to sell it have a hard money lender lined up. 

If it cash flows as arental and needs minimal work you can still buy sub2 and that gives you time to fix it up and secure a traditional loan. maybe even BRRR it.

Even if he isn't moving for 6 months you can still get it under contract and close before he has to move. I

I would find someone doing what you want to do and ask if you can shadow them for a week in their job. It sounds like you want to do large developments but I would start with a small flip then do a new family home. That is a much bigger leap because of all the fees and infrastructure involved with bare land. If you start small your mistakes won't be magnified. Then you can bite off more. Just remember it all starts with a deal on the purchase side. Don't buy at full retail and expect to make it up in the development side unless you see something others missed like a SFR on a lot that can be split to build 4 houses. Or combining it with the neighbor's lot and building an apartment.

In some cities getting planning approval to build can take a long time so getting the land under contract but not purchasing it then entitling it to be built on then selling it to a developer on the condition that they keep you involved in the deal is another strategy.

Good luck!