All Forum Posts by: Taija Walkowiak

@Jason Hawrylo my suggestion is to just make sure you know the market and don't over estimate the ARV or under estimated the construction costs.

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $275,000
Cash invested: $1

Contributors:
Mark Golden

This is a 9 unit apartment (8 - 2 bed 1 bath and 1 - 1 bed 1 bath) building that was vacant and condemned in a great area close to the University. We will be doing a full gut remodel to the whole building. We bought the building for $275,000 we are putting $225,000 into it so total investment is $500, the after repair appraisal came back at $685,000. We will rent the building out for a monthly gross of $8,250.

What made you interested in investing in this type of deal?

It has a great location, it was very close to University of Nebraska Lincoln East Campus, and has a massive, brand new multi million dollar frat house next door. We have bought multiple properties that were very distressed this was just a much larger project. We were also very interested because we could buy it for little to no money down because we could knew we could get the after repair appraisal very high!

How did you find this deal and how did you negotiate it?

We happened to drive by when we were driving for dollars and we tried every way possible to get in touch with this owner. Finally we discovered where he worked and we knew a girl who used to work their and we asked her if she knew him, and she did but not very well. She reached out to some people who she used to work with that knew him well and the next day he finally called after a year and a half of trying to get in touch with him.

How did you finance this deal?

We have built a very strong track record with our bank and we have a great relationship with them so they financed the purchase and the rehab costs as a construction loan. Once construction is finished we will refinance this into an in house 5 year fixed 15 year adjustable rate mortgage. They wanted us to have some "skin in the game" so we had to put $55,000 down that we payed with our HELOC but when we refi we will get that money back.

How did you add value to the deal?

This deal is a full gut rehab, the unit were in terrible shape so we are doing new siding, new windows, new kitchens, new appliances, new bathrooms, new trim, new paint etc.

Lessons learned? Challenges?

3 days before closing we got the appraisal back and the appraiser had discovered from the satellite image on the GIS that the lot line was off, half of our parking lot technically belonged to the neighbor. So I had to work with them and they agreed to sign an easement agreement that gave the parking lot back to us and that delayed closing by 3 weeks.

@Nawzad Babiry

I bought my first rental for $43k put about $7k in it and rented it for $1,000 a month and have had the same renter for 4.5 years so already made all my money back. House is now worth about $100k and I own it free and clear.

Then another property I bought for $13k put $75k into it and rent that for $1350, house is worth $155k!

Hello, what town is it in? I am located in Lincoln and I have been looking for a mobile home park to buy. Shoot me a message I would love to chat more about this!

Investment Info:

Single-family residence buy & hold investment in Lincoln.

Purchase price: $42,500
Cash invested: $1

Contributors:
Mark Golden

This house was abandoned for 9 years, it was severely distressed. There was stuff and trash everywhere, at some point it had squatters living in it, there was graffiti on the exterior, and all the copper pipes and wiring had been stolen out of the house. It took me 9 months to track the owner down, even after tracking him down I never met him in person. We did a full renovation to this house, we also added a 4th bedroom and an additional bathroom making the home a 4 bed 3 bath. We purchased this house for $42,500 after the renovation we are all in at $125,000, the house appraised for $200,000 and we rented the house for $1700 per month. We have $0 cash into the property, we used our line of credit to get the house bought, then we got a construction loan for the renovations and once we were finished we refinanced the home. Overall this was a great purchase and the biggest thing we learned was that you should never give up on a property. I had been told multiple times by the owners father that he wouldn't sell it but I had seen the house and knew it was vacant and the back door had been kicked in for some time, so I kept on them calling and sending letter. Eventually the owner called me out of the blue.

What made you interested in investing in this type of deal?

We have done the BRRR method before and it has worked out very well for us. I was interested in this property specifically because it is in a great neighborhood and therefore would have a high appraisal and would rent for a lot as well.

How did you find this deal and how did you negotiate it?

Our friends nephew lives in a house next door to this house however since it was vacant for over 9 years almost every RE investor in town had this house on their list, but getting in touch with the owner was next to impossible. After hitting a dead end looking for the owner I started looking for his family. I found his parents and spoke to his dad who basically told me to F off a few times. Eventually his mom answered and I told her what shape the house was in. 2 weeks later the owner called!

How did you finance this deal?

We purchased the house using our line of credit, then we got a construction loan, and once construction was finished we refinanced that loan into a fixed 30 year note.

How did you add value to the deal?

We did some of the work ourselves to the property, also we added a 4th legal bedroom and a bathroom in the basement.

What was the outcome?

The outcome was $75,000 in equity and $500 per month cash flow.

Lessons learned? Challenges?

The biggest lesson we learned was that you cannot give up chasing a property especially when you know the property is vacant and distressed. The challenges we faced in the beginning was learning how to juggle 2 rehabs at once and then throughout the project we had to learn how to start hiring more things out instead of doing them ourselves.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

We worked with Lincoln Federal Savings Bank for the financing and we have worked with them on other projects as well and they were fantastic!

@Kevin Brown The second Monday of every month we have a real estate investors meeting in Lincoln at 7pm at Grata. They have a facebook page called Lincoln Real Estate Investors.

@Megan Ahern Yes we used McGrew Complete Construction, they do a fantastic job. I don't remember what that part of the framing cost but give them a call for any framing needs.

Hi Dave, my boyfriend and I also have full time jobs and I am also a part time real estate agent. So we spent every night and weekend for 6 months working on this house. My boyfriend is a salesman for 84 Lumber but has a construction background and knows how to fix everything. We did hire the plumbing, electrical, hvac, roof and drywall out but other we did the rest. It was a lot of work but it was well worth it, now we are on the hunt for our next project!

Trista the squatters had moved out already luckily!

Hello,

We just finished a BRRRR in Lincoln, Nebraska. This is our 2nd rental we have. I have included some before and after pictures as well! So we bought this house in June for $13,000. It was a foreclosure but it was in such bad shape that the bank said we don't want it, it also had $9,000 in liens against the property, but the city of Lincoln also decided they didn't want this property. So they gave it back to the owner, which is who we purchased it from. It was a win-win situation she was so happy because after the liens were paid she ended up with $4,000 cash and we were excited about the property. This house is a 1,006 sq ft bungalow 3 bed and 1 bath, with a huge (24 x 30 detached garage and a large lot with an alley at the back of the property and the neighborhood is really nice. Lets get to the part of why the bank and city didn't want it! There had been squatters living in the house both human and raccoon! The roof was shot, it had a large hole near the chimney and most of the shingles had curled up and fell off. The soffit, fascia and gutters were also laying all over the yard and no longer on the house. Most of the windows were broken and the foundation had a serious bow down one entire wall. There was literally nothing left that we could save in this house, we tore it down to basically nothing. The only things we kept were the exterior walls and the siding, it had aluminum siding on it! The house was built in 1926 and was framed with 2x4s only, so we had to reframe all the roof joists and ceiling joists because they were all sagging, we reframed every interior wall and put new headers in for all of the windows. We put all new electrical, plumbing, hvac, windows, doors, roof, cabinets, flooring, bathroom, you name it we replaced it. Luckily the garage didn't need any work, we did put new windows and doors on it, but the actual garage door was in great shape and so was the opener. So once we were done this house was completely brand new. We did most of the work ourselves too which saved a lot of money. We paid cash for the house and then got a construction loan for the project, once we finished we refinanced and pulled the $13,000 back out to use for our next project, we purchased this in June and finished it in December it was a long hard 6 months but it was totally worth it. Here is a break down of our costs...

Purchase Price: $13,000

Rehab Costs: $77,000

Total: $93,000 (including closing costs)

Appraised Value: $155,000

Equity: $62,000

Rent: $1,100 per month!

We are on the search for our next project!!

-Taija

Hi Kyle, it is my understanding that you are grandfathered in to rights on that property. The city wouldn’t let you build property like that today but I know there are a lot of houses with the same situation in south omaha and people rent out both houses separately, they used to be called mother in law houses. You should be able to rent them out separately with no issues. I have always wanted to find a property with that setup, sounds like a great investment, congrats!