All Forum Posts by: Tyson Taylor

@Spencer I., They probably won't lift the lien, but you could try this:  Have the seller who owes the debt contact the lien holder and ask if they will issue a release on the condition that all of his proceeds from the sale go to paying down the lien. 

Honestly, this sounds like a nightmare to wholesale. It'd be hard enough to close it  in a traditional way.

@Brionne Moss, Liens are recorded at the County Clerk's office. They are publicly searchable, though in most cases you have to go to the physical office. 

Typically, you don't factor liens into the offer price, though there should be a condition in the purchase agreement that all outstanding debts/mortgages be paid in full at the time of closing and that the buyer gets title free and clear of liens. 

If liens are not addressed and title is transferred without warranty (cash deal/quit claim deed). Then the responsibility for the liens transfers to the buyer, because they are attached to the property, not the individual. 

Good luck.

@Michael R.,

I wouldn't go the small/manufactured house route, not because I don't like the idea, but I think you'll end up getting into building code issues.

Separate structures end up invoking all kids of building code/fire code requirements for fire resistive construction, building separation, etc. Utilities will also be harder. It could work, I'd run the numbers against a 4-plex, I think you'll probably end up with a better ROI, more units generally always win.

I don't know your local market though, if 2bd apartments aren't renting or are overbuilt and folks love the little houses then obviously consider that.

Good luck! and please update with the results from the discussion with the village, I'm curious to see where they land.

@Michael R., It bugs me when Cities have some grand vision but don't update the zoning to reflect it.  It also bothers me that they're not the ones paying for the new development but somehow it's "theirs"...but I digress.

 It wouldn't hurt to have another conversation with them. From your side it should sound something like "I have this land that with the current zoning will allow me to build 3-4 more units, I'd like to do that." If they say they have other plans and won't let you, then they need to tell you what you can build. 

If it's zoned multi-family, then they pretty much have to let you build it if it meets all the regulations.  They can make life difficult, but ultimately they cannot say no (again, only if you've met all the zoning/development requirements in the code).  This is considered being "arbitrary and capricious", they have rules adopted, if you follow them they can't deny your application- otherwise what's the point of the rules? 

I think you're in a decent position.  If they do end up rezoning it to a commercial zone, then it'll probably make the land worth quite a bit more.  Worst case scenario is that they let you build more units...which isn't bad at all.

That is pretty ugly! 

Here's an idea for paint: street view (I hope that works) They painted each unit a different shade, I think it's great. Before it was all the same beige brick color.  I also like red doors, don't know why, but I think it's nice. I'm not sure I'd paint anything black in Arizona...seems like a fire hazard.

The fence is a good idea, give people a little semi-private outdoor spaces.  I'd want trees, or some kind of shade and little patio areas?  I'm having flashbacks of living in Las Cruces, my yard was gravel with yucca, cholla and prickly pear...definitely skip the grass. 

@Jim Tiernan, You were lucky, or smart.  I just picked up a small multi family in Cole that needs a ton of work, I think you're spot on about that neighborhood, I wish I'd had the resources to get in there when you did.  Globeville is also interesting, I like that little neighborhood too.

@Mike R.,

Mike,

I think we're in a similar environment here in Denver, it's made things tough.  I see deals here with really low cap rates also 3-4%, who buys that?!  There are bigger funds out there who I think just want a portfolio of stable cash flow properties, even if it's only 5-6%, it works for them, not for me.

I consider myself a big fan of contrarian investing, buy when there's blood in the streets, avoid the feeding frenzy.  Right now, instead of pushing capital into new things, I'm focusing on improving the value of my existing assets, creating more equity and increasing cash flow.  

Though I am keeping and eye out for deals though. I think there's still a lot of value in land development or distressed properties (if you can find them). Investors are flocking to the tried-and-true deals, I'm going to try to be where the herd isn't today but will be tomorrow.

@Benjamin Blackburn,

This is not an easy question, but it's a good one, and one I think about often.  I only really know Denver, so forgive my ignorance of other areas.

My opinion on the matter is a little tricky to discuss because it deals with primarily race and income.  Frankly, most people aren't comfortable discussing it as we have become very averse to talking about anything that may be offensive. I'm going to throw my opinion and real life observations out there, please consider it my view of the world as it is, not as I want it to be...

15-20 years ago the easiest way to get ahead of the gentrification curve was to follow the artists and homosexual couples into the less desirable neighborhoods.  In Denver, 20 years ago, this was 80211. At the time is was predominately Hispanic with lots of non-owner occupied homes.  The block I bought my house on had about 12 homes, at least 3 were gay couples.  They were the vanguard into the new neighborhood, pushed into areas where they could make their own space because they weren't accepted into traditional neighborhoods. Now, 80211 is still a very hot Denver zip code, but most of the gay couples have left (or nobody notices anymore really), and most of the Hispanics have been pushed out.  Now it's full of stroller-pushing white folks, and oh yes, @Flavio Zanetti is correct, the Starbucks began to show up in 2003-2004. 

Today, I think it's the hipster culture leading the charge into new neighborhoods.  They transformed RiNo (80205) in Denver.  Since 2010, land prices have increased 4-5X. This comes at the expense of displacing the existing Black population, a group that's occupied  the 5-points neighborhood since the 50's.  5-Points had a negative and scary connotation up until a few years ago.  Now white people are tripping over themselves to run into that neighborhood and property value is skyrocketing. Zillow Link Sort this chart to the bottom tier of home value...

Gentrification is an ugly process, generally displacing low income minority families. It's also not really possible to stop it (or start it for that matter).  It happens organically when there's an unsatisfied demand. When all the existing places are filled and expensive, economics push people to the next most desirable option.  Eventually, these neighborhoods hit a tipping point and the whole thing flips.  6-7 years ago, even at the height of the market, pre-crash, you could buy homes in Sunnyside for $200k, today the median home price is $344k.

So now I look at the map of Denver and try to evaluate where the rich white people will want to move next.  People will call me a cynic and a racist, but I feel like you have to consider race when evaluating a neighborhood.

I hope and expect that there will a date in the future when the race of a neighborhood will not correlate to it's value. In the mean time, if you ignore it, you will be missing an important piece of the puzzle.

In the burbs' I'd just pay attention to school districts. Parents lose their damn minds over school ratings.  Buy land in a neighborhood with a poorly rated school that was improving, when it was finally satisfactory, I think you'd make a killing. 

As always, I'm open to hearing other folks opinions, especially if they're contrary to mine, that's how we learn.

Good luck.

@Frank Jiang, nice. Your quick spreadsheet makes it easy to see what I've been trying to explain.  

@Josh Gevedon,

The biggest problem with a home and car loan is that they limit your ability to finance another mortgage because they increase your DTI. If the car loans are crushing you, then perhaps you should consider getting rid of one?

The investment deal should be generating good returns, so as long as your current debt isn't completely out of whack you should be fine- or even better off with the additional cash flow. 

I got into the anti-millionaires club this year, over $1M in debt! Which would have terrified me early on, but not now. I realize all that borrowed money is working away for me, each dollar I borrow (that's not for the damn house or car) is making me a decent return.  I contribute $2, the bank will give me $8, and I'll make 7% on all $10?!  Yes please. That's what I love about real estate.