All Forum Posts by: Scott Vaeth

@Randall Alan Thanks your answer! Even though it may work in my calculator, I'm realizing obtaining the funds to rehab can be tricky. Since an fha 203k might be more expensive, and I'd have to hire a contractor to do the work, it sounds like personal loans and private money are my best option. It seems difficult to net positive when paying interest on a conventional loan AND a personal loan 

@Nicholas L. Appreciate the response! It seems like most people shopping for real estate in my area are investors with enough cash to cover all costs. Because this has been on the market for some time, I'm trying to use it to my advantage without offering close to full price. 

Hi there,

I found a property in great condition that I'm planning to put an offer on. My plan was to hold it long term and convert a detached garage into living space (1-2 units) to rent out. The issue is that I don't have the funds to cover the conversion, even though I'd be doing the work myself. As a first time home buyer, I planned on putting down 5% for a conventional loan. Are my only options to fund the renovations; personal loan, private money, hard money, or a fha 203k? 

Hi BP,

I found a property with a detached garage that I'm hoping to convert into 1-2 units. The house itself needs little updating (paint walls, remove popcorn ceilings, update fixtures, paint kitchen cabinets and replace kitchen countertops). I want to leverage how long it's been on the market in my offer, but wanted to get people's opinion on what to do. I fear that I'm lowballing if I was to use the 70% rule since the house itself is valued around what it's worth. From what I can see, the house only needs $2.5K-$5K worth of work and I plan to do everything myself as it's my first property. If I plan to convert the garage into 1-2 units, how should I factor that cost in my offer? Offering over $100K less than asking seems insulting. 

For context: The listing agent claims that there hasn't been many negative comments towards the house, but I think people fear potential noise of being next to an auto shop. Its taxes are also high for the area and is currently vacant. Any advice is greatly appreciated!

Hi there BP! I found a single family house that I'm interested in because it has a large detached garage in the backyard that I'd consider converting into an apartment. This property has been on the market for some time. I think it's because of the location being near a busier street and a run down commercial property adjacent to it. However, recent comps in the area are stronger than I was expecting. Anyways, I was investigating zoning and permit laws in Greenville, SC and saw that you can't build a detached garage larger than 200 square feet. Since this garage is easily 3-4x larger, should I be concerned that this was illegally built? 

Would I call the city to figure this out? I'm considering having a contractor on site with me when I go to tour the place with my agent, but wasn't sure if there is some homework I can do beforehand. Any advice would be appreciated! 

As a first time homebuyer, I was planning to use a conventional loan and put 3% down. However, I found an opportunity to purchase a duplex that's currently occupied with tenants. I considered using hard money to help in putting 20% down so I don't need to live there but being that it's already at the top of my price range, paying higher interest on the hard money on top of my monthly mortgage payment would be way too expensive. I would love to house hack but multi-family units are rare in the area even though it's rapidly growing. Right now, I rent a townhome that's at least 50% cheaper than most places in the area so I've been able to save more and more, but most likely won't afford a 20% down payment in my area anytime soon.

For people who use hard money with, is it only worth it if you get a really good deal on the purchase price? Especially if you don't have the funds to put 20% yourself? 

Hi All,

My initial investment strategy was to house hack in my area but multi-family units are very rare to come by. When they are up for sale, it's usually in an area that's less desirable than where I'm looking to invest. While I would love to BRRRR a property, I'm noticing a lot of investors putting down full cash offers on properties that will still require work.

What I don't understand is that these homes that require updating are being bought up by these investors even though the comps in the area seems low. Also, new development is being built throughout the area and are selling at similar prices. I don't know if that's intentional to get more business, but the comps aren't showing the new houses as being worth more. Does that mean people see the longterm potential in this market?

Any thoughts here? Thanks!

Hi All! 

I've been learning a lot through bigger pockets over the few years and finally decided I needed to get on board and diversify more investments. Initially, my goal was to BRRRR a property in the Greenville County, SC market as it's rapidly growing, but most properties are being renovated and investors are putting full cash offers in on the ones that aren't. While I would love to house hack, there are very few multi-family's in the market. When they do appear, it's usually in a less desirable area where it seems like the comps aren't strong.

That being said, a coworker of mine bought a 3bdrm/3bth house in a new development that's in a favorable location at a price that's lower than anything I've seen. Both older and newer houses with the same proximity to the downtown area aren't selling this low. The area itself hasn't been gentrified yet so the comps are low in the area but the investor and the builder are the same person. Since he's not using a listing agent, and hasn't promoted it on the MLS yet, should I consider this as my first home purchase?

For context: My coworker's house has already appreciated since purchasing it last year, but I understand there's risks involved with putting all my eggs in one asset that I won't be able to add more value to. For my first property, I plan to use a conventional loan and put 3-5% down. This home purchase would be on the high end of my budget still.

Any advice would be great! 

Thanks!