All Forum Posts by: Steven Segal

I do some investing for some money guys, and they are looking to get into PR. They already setup some shop in order to save on taxes, but they haven't dug into real estate as of yet.

I am heading down there next week and looking to connect with some people while there. 

Also, any insight in PR is appreciated.

Essentially I have a contractor who bills me hourly for jobs. I keep him extremely busy with investment properties - whether it be rentals or flips. Great relationship at this point. 

Currently, he just gives me a weekly bill: 

Jim - X hrs and Y rate

Fred - A hrs and B rate, ect

However, there is no scope attached to it; nothing classifying it as improvements vs. repairs. (Note: I don't have any issue with this and trust him with time.)

Is this something I need to change? Or does a timesheet stand as an invoice? Legally and tax-wise? How to allocate? We have worked this way for about 3 years now. However, I am looking to take a more passive stance in the company to pursue some other things and need to implement changes to make it so it can run without constant input and decision making - need procedures in place.

Also, it is worth noting that he isn't doing any of your large depreciating items - hvac, plumb, electric, roofing... More cosmetic things (like painting) and small things (like changing out lam countertops and tile work). Those things we use other subs for.

The other downside of this setup, which I know, is this type of billing - even if legit - becomes to walk the thin line of employee vs independent contractor. I am thinking about how to deal with this currently.

Any ideas/insight appreciated.

Brie-

Interested. Please send me additional info at [email protected].

Thanks,

Steven

If your goals have something to do with cash flow to live off of, save up and invest. Get in the hustle!

Purchased a house for 158K. Decent size rehab and all-in at 225K. The house is worth about 250K. Obviously, no room to flip it - although some equity. I would like to cash out on it and move to the next one. No mortgage or liens on the property.

However, I don't have the stated income last year to support this refinance (even tho it is a super safe investment). It is also in an LLC and people don't seem to like that. I'm not opposed to a personal guarantee - and I have significant personal assets.

Does anyone have any ideas or have a contact for somebody who would be able to do a cash-out? Looking for minimum 60% LTV (higher if possible).

You need to go to McBobs. Best rueben in town.

I don't think so - this is a 32 unit. Our expenses are a little different too.

I am looking into baseboard heating which puts the bill on the tenants. However, it is expensive to operate. I don't want to have to lower rents.

I think it could be a good value add play if you could retrofit them with furnaces. I can't see the cost of putting them in all units not having a 10% ROI if it saves you 20K+ per year.

Gas furnaces heating 600-700 sf units.

Not a bad deal with the bill. Motivated seller who is just liquidating. I bought two from him last year which he took 70% of asking in cash. He will also do financing. I can get it for 8-9% cap with current rents (can push them $50).

Seems like a I decent value ad play. Spend 50K (huge guess) and break-even on it in two years. Sell for 10% cap at then current conditions. 

Looking at a 32 unit deal in Milwaukee. However, the heating bill is 33K/year. They are newer, but it definitely hurts the investment. It has been sitting for a bit, and I think that number has been their big obstacle in seller the place. 

Has anyone retro-fitted a multi-family to have furnaces in each unit? How much does it usually run per unit? I work in the land of A/Cs (Florida), so I haven't done anything like this.

Thanks for any input,

Steven

Convert that to yards. $3.50/yd, as mentioned above, is a good price. 

Sometimes HD will install for free at a certain square footage (but that is more that 600 sf).

I generally avoid handymen doing carpet. With the humidity I have in Florida, I used to have them do it and had to get a lot of them stretched later on. Eventually went to just having a carpet guy do them.

If you have handymen already there, can sometimes save by having them tear out tho.

600/9 = 66.7 yd^2 *3.50 = $233.33

*However, you are measuring in square feet. Your measurement and a carpet installer measurement generally don't align due to drops.