All Forum Posts by: Tom V.

Hey Brennen -  Good work and nice finish choices.  

I hope these permit issues go in your favor.  Those kinds of after-the-fact issues can be a real bear and very subjective depending on who you get as an inspector/permit checker.  

I have been advised to avoid the obese bearded guy at 300 Richards whenever possible.  

Good luck!

This looks like a very good value at this price.  Seems like a great home. 

https://www.redfin.com/CA/Beverly-Hills/3090-Franklin-Canyon-Dr-90210/home/6834175

Market in San Francisco has topped out a little since the end of the summer.  More balanced buyer and seller flow even without a lot of inventory.  Good luck to you.  

How is this going?

@Ann Howell

How much money were you going to put into this deal and how much did you think you were going to make annually?

Why is this deal attractive to you? Sometimes FSBO stands for

Freaking

Stupid 

Bad 

Opportunity

It sounds like you have never purchased or developed land.  Why would you choose this first?  It is much more complicated than buying an existing place and trying to flip or hold. 

Don't let the low price fool you.  If you are uncertain about proceeding and unsure about whether you will lose money, that is your brain telling you that you don't understand enough and that you will probably lose money.  

Pick something easier to start with.  Surgeons don't go straight into open heart surgery - they learn to stitch up a wound first.   

You might get lucky on this deal, sure.  If you feel lucky, go to Vegas and bet on red on roulette.  You could double your money.  

Bank will want to see LLC formation documents before they open your account.

Bigger issue is that I can't imagine a deal that is good for you or your counterparty if you are afraid to use your name.  LLCs still need signatories regardless.  

Are you a licensed architect?

@Lisa Hoyt

Two points for your sister:

1.  I think it is counter-productive to show a unit that is still occupied.  You are going to turn off potential good candidates.  

Wait for them to move out, make it look as crisp and clean as possible, take good pictures and only then, after a month of marketing in rent-ready shape, should you consider adjusting your price.

2.  People almost always rent the best unit they can afford.  By lowering the rent, you are unlikely to find a really well qualified tenant who wants a good deal.  Instead, (as you said) you would simply be more likely to attract more people who could just barely afford to rent your place at the lower price point.  

Market the property well and then find the right tenant.  

You should speak to a banker in advance.   Assuming they lent you the funds as a rental property, you will undoubtedly need their blessing or lien release before you split the parcel.  It won't help your cash flow timing if you have to pay off the loan before you line up a buyer for the home at the close of escrow, timed with your lot split.  That gets complicated.  

Your other angle would be to find a non bank lender (hard money) person who understands what you are trying to accomplish and get them on board from day 1.  The difference is that a bank might charge you 4% interest while a hard money guy will charge you 12%.  That may sound like a lot, but would not for a regular flip. 

You also need to understand from your local zoning/planning authority how difficult it would be to split the lot, and if you do, how expensive it will be to connect to utilities etc for any additional mobile homes you try to set up. 

Go talk to your planning department and go talk to a bank.  

http://www.homedepot.com/p/Rust-Oleum-Transformati...

Follow the directions and do prep work and it will be fine.  But it takes a lot of time to do it properly.  I have done this in rentals but I would not mess around on a flip.  

If the cabinets need updating, I would prefer just to buy new cabinets and move on....