All Forum Posts by: Thomas Magill

Woodward Homes

Investment Info:

Condo fix & flip investment in New York City.

Purchase price: $250,000
Cash invested: $15,000
Sale price: $472,500

I purchased this condo to live in with the anticipation of holding on to it for as long as possible. Things changed when I slowly started to fall out of love with NYC. I started the renovations of this live in flip shortly after the purchase, and worked on it after getting home from work and on the weekends. I did most of the work myself and hired a couple plumbers and electricians after shocking myself a couple times.

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

It was in the best area (in my opinion) of New York City... the West Village. I initially wanted to keep it forever, but once I made the decision to go out on my own, I knew I need to sell it in order to start my company. So, this went from a live in flip to hold, to a live in flip to sell.

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

I found it on streeteasy.com and then contacted an agent to help me with the purchase. This was my first individual purchase of a property. I'd purchased one before this but it was an investment property within a partnership.

How did you finance this deal?

Traditional financing with 20% down and a 30 yr mortgage. I'd never purchased anything this way before and this was in 2012 just when we were coming out of the financial crisis, so lending was very tight. I had to get a 'gift' from my mom to show 2 years of liquidity in an account, in addition to a bunch of other requirements.

How did you add value to the deal?

A lot of sweat equity. I bought 15k worth of materials, and did most of the work myself. I worked in construction at the time and received some after market or damaged materials from some of my subcontractors.

What was the outcome?

I lived in the property for about 5 years. I ended up selling to a news anchor off market who owned 2 other units on the first floor. She was fantastic to work with and made the process very easy for me. She then leased the property back to me until I found another place to live in North Carolina.

Lessons learned? Challenges?

The biggest lesson learned, which I still have issue with sometimes, is to hire professional to do the right work. I tried to do everything and after a couple shocks and some water damage I learned my lesson.

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

No

Investment Info:

Single-family residence fix & flip investment in Gastonia.

Purchase price: $90,000
Cash invested: $74,273
Sale price: $221,000

I purchased this property directly from the owner of the property, but was introduced to him from a wholesaler friend of mine who could not make the deal work for her, so she stepped aside and let me work with the owner directly. I eventually gave her $1000 for her helping out. One of the stipulations for the purchase was that the owner's son (who grew up in the house) could come back and look at the property when it was complete. He loved it, and walked me through a lot of memories.

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

This is a great area to invest in Gastonia. Large lots with a lot of great foliage.

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

I found this deal through a wholesaler, but once she realized she couldn't make the deal work for her, she put me in touch with the seller directly.

How did you finance this deal?

I financed this deal with private money

How did you add value to the deal?

This was a very large renovation project that covered almost every part of the project. New kitchen, bathroom, added an owner's suite to the home, new plumbing and electrical, the HVAC worked but I had to replace the coil and duct, refinished floors.

What was the outcome?

This property took a lot of time to sell and eventually received a less than favorable appraisal, so it was a triple. Good money

Lessons learned? Challenges?

I had the opportunity to make the owner's suite much larger but neglected to because I thought the size fit within the context of the home. I was wrong. I should have made it a couple feet wider so the walk in closet didn't impede on the space so much and make it look like an awkward layout. I eventually decreased the depth of the master closet by 18" to open up the space a little. I'm not sure if this is what led to the sale but the sale happened shortly there after.

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

Just the buyers broker

Investment Info:

Single-family residence fix & flip investment in Belmont.

Purchase price: $150,000
Cash invested: $33,300
Sale price: $249,900

This was supposed to be a homerun deal, that ended up being a ground rule double. The company who we contracted to fix the well on the property ended up breaking it completely, so we had to install a completely new well that cost about 7k, so that was a huge chunk of the ol' profits we were not prepared to let go.

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

This area is one of the premiere locations to buy around Charlotte, NC. I was really excited about this deal. Unfortunately, I learned some good lessons. We went a little about our renovation budget in an effort to sell the house for more and because we had a lot of room in our numbers. When the project was nearing completion the well contractor broke the existing well that worked but did not produce a lot of water pressure.

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

I found this deal through direct mail marketing. The sellers mother had just passed away deeded the property to her daughter. The daughter was distraught over the passing of her mother so I negotiated with the daughter's husband. He was a great guy and very helpful throughout the process. He called me the day of closing and asked if we could cancel the closing and give me $5,000 to hand the deal back to him. But, I respectfully declined and moved forward with the deal.

How did you finance this deal?

I partnered with a buy and hold investor who was looking to learn about flips. I also partnered with him on a buy and hold property for the same reasons. He provided 50% of the deals funding through a private money investor and I self funded the rest.

How did you add value to the deal?

We added value through a lipstick plus renovation. We did some plumbing updates as well as a new kitchen and bathrooms.

What was the outcome?

We eventually sold the property to a lovely woman who took my real estate signs off the street because she didn't want anyone else to purchase the property. She gave the sign back to me after closing.

Lessons learned? Challenges?

We did all of the things right on this property and hired the right contractors, but unfortunately things happen that you cannot plan for. ie a well contractor who is 'well' regarded breaking your well...

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

No

Investment Info:

Condo buy & hold investment.

Purchase price: $180,000

This property I purchase to live when I moved from NYC to Charlotte. I went from living in 250 sq ft, to 800 sq ft and thought I was the richest man in Babylon. I lived in the property for almost 3 years and moved in with my pregnant GF. I tried to AirBnB the property, but it coincided with the Covid pandemic, so it went not where. Eventually I started getting people to rent it and then I had two tenants who wanted to continue their stay. So, I turned it into a traditional rental.

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

Originally this was my primary residence. I loved the interiors of this condo but it wasn't in the best location. Its in the middle of uptown Charlotte, but was right by an overpass. I kicked myself when I was about 6 months into living there because my car was broken into a couple times. Eventually, I moved and turned it into a STR, but due to Covid it was quickly turned into a traditional rental.

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

I found this through the MLS and negotiated through my broker.

How did you finance this deal?

I bought this property with traditional financing with 10% down. I had to purchase the property as a second home because I bought it before moving to Charlotte. I did this because I was leaving my W2 and did not know how to finance it otherwise.

How did you add value to the deal?

Not a lot of value add, but if I had to choose something it was switching from a STR to a traditional rental and going from collecting zero dollars in rent to collecting 1500.

What was the outcome?

I eventually put a tenant in place who was a hold over from AirBnB.

Lessons learned? Challenges?

Everything worked out on this property and it has appreciated about 50K over 4 years, as well as 4 years of principle pay down and depreciation. So, everything works out in the end, and if it hasn't worked out then its not the end.

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

Just my broker.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Kannapolis.

Purchase price: $210,000
Cash invested: $20,000

Contributors:
Thomas Nance

The previous owner of this property was looking to cash out on this asset quickly to help fund a new build community. We purchased this property off the MLS in 2019 and replaced the roof and renovated the vacant unit of an inherited tenant who's lease expired. Within the first 3 months we only had 1 paying tenant and no one wanted to rent from us even at a reduced amount, but we were getting a lot of applications and people were paying the application fee whiched helped us pay our mortgage.

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

This was my first rental property purchase and I partnered with a seasoned investor to help me show the ways of the dragon. I found the property on the MLS and negotiated the sale, my partner brought the private money and we were closed within 10 Days.

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

I found the deal on the MLS from a seller who owned a considerable amount of small multifamily rentals. We negotiated a purchase price with the seller and were closed within 10 days. In addition, the NCDOT bought 5' of the front of our property to widen the road. I negotiated an amount that was beneficial for both of us, but it took a very long time to get the money for one reason or another.

How did you finance this deal?

My partner on the deal brought in private money and then we refinance through a traditional 30 year mortgage.

How did you add value to the deal?

We added a new roof replaced some HVACs and renovated the interiors of each unit.

What was the outcome?

We finished our refinance early this year and collected our NCDOT funds and the property is doing well

Lessons learned? Challenges?

The biggest lesson learned is to have reserves because you may be inheriting really bad tenants, so you'll need reserves to float you while things are getting worked out.

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

No

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $84,257
Cash invested: $58,443
Sale price: $181,000

This property was unique because it was the first time I've done 'subject to' financing for a flip. The seller was about to go into foreclosure until Covid hit and then her case was continued until mid July. I stayed in touch with her throughout the process and eventually closed. I purchased the property at as a 2/1 and converted it to a 2/2. The previous owner had pets that used the home as their 1400 sq ft bathroom so I refinished all of the floors and Kils the walls.

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

At the time of purchase, a lot of my private investor money was deployed on other projects. So, this project was very appealing because they were offering it at 'subject to' because the owner owned more than the property was worth.

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

I got this deal through a direct mail campaign. This was a very unique seller. I don't know how much I can share but lets just say she was different.
I negotiated with her directly and we came up with a price to pay off her home and provide her with a little money to move. She was very pleasant to deal with while she was sober, but once she got a couple drinks in her she was pretty nasty. Once I paid off her bank I cut her a check that she never cashed, very strange.

How did you finance this deal?

The cost of the home was financed 'subject to' and I self funded the cost of construction.

How did you add value to the deal?

I added a bathroom (owners suite), took out the drop ceilings in the living room, opened up the floor plan, and new kitchen/ bathrooms/roof/HVAC/Electrical/Plumbing.

What was the outcome?

I sold to a great guy who has since done some additional work to the exterior of the property with a fence.

Lessons learned? Challenges?

The biggest lesson learned was I needed to get access to the lending institution's pay off amount. There is a form the seller signs that allows the 'subject to' buyer to access. The lender would not provide the pay off amount until January 1st 2021 for tax purposes, I'm assuming, so I had to wait two months to close on the property.

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

No

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $84,257
Cash invested: $58,443
Sale price: $181,000

This property was unique because it was the first time I've done 'subject to' financing for a flip. The seller was about to go into foreclosure until Covid hit and then her case was continued until mid July. I stayed in touch with her throughout the process and eventually closed. I purchased the property at as a 2/1 and converted it to a 2/2 as well as opened up the kitchen to the living room. The previous owner had pets that used the home as their 1400 sq ft bathroom so I refinished all of the floors and Kils the walls.

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

At the time of purchase, a lot of my private investor money was deployed on other projects. So, this project was very appealing because they were offering it at 'subject to' because the owner owned more than the property was worth.

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

I got this deal through a direct mail campaign. This was a very unique seller. I don't know how much I can share but lets just say she was different.
I negotiated with her directly and we came up with a price to pay off her home and provide her with a little money to move. She was very pleasant to deal with while she was sober, but once she got a couple drinks in her she was pretty nasty. Once I paid off her bank I cut her a check that she never cashed, very strange.

How did you finance this deal?

The cost of the home was financed 'subject to' and I self funded the cost of construction.

How did you add value to the deal?

I added a bathroom (owners suite), took out the drop ceilings in the living room, opened up the floor plan, and new kitchen/ bathrooms/roof/HVAC/Electrical/Plumbing.

What was the outcome?

I sold to a great guy who has since done some additional work to the exterior of the property with a fence.

Lessons learned? Challenges?

The biggest lesson learned was I needed to get access to the lending institution's pay off amount. There is a form the seller signs that allows the 'subject to' buyer to access. The lender would not provide the pay off amount until January 1st 2021 for tax purposes, I'm assuming, so I had to wait two months to close on the property.

Investment Info:

Single-family residence buy & hold investment in Kings Mountain.

Purchase price: $69,000
Cash invested: $55,000

This project was originally purchased to flip, but after speaking with the property owner next store, I was able to get that property under contract. So, I decided to keep this property as a BRRRR. This area is a little far from where I live so it didn't make sense at the time to keep this property, but after further thought, and getting the property next door under contract, I reconsidered.

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

The further along we go into this cycle the more expensive properties get, so I've had to adjust my investment locations. This property is located in Kings Mountain, NC. Kings Mtn is about 45 min outside of Charlotte. Kings Mtn is in the process of building a casino and I felt the property values would significantly increase due to the influx of population. I continued to study the area and realized this town could stand on its own with or without the casino, so it solidified my decision.

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

I found this deal through a wholesaler. He originally had the deal out there for 90k I believe and we made our way down to 69k. The wholesaler made 24k on the wholesale fee, and I believe the property is worth 156k. So, after investing 124 into the deal I created at lease 30k of forced appreciation.

How did you finance this deal?

I self financed the purchase of this deal, and got an unsecured construction loan from a private money lender.

How did you add value to the deal?

I did a full renovation of the interior/exterior of the property, as well as convert a mechanical closet into another bathroom. So, the property went from a 3/1 to a 3/2.

What was the outcome?

The project took 2 months to renovate and put a tenant in place. I had to wait for the property to season in order to refinance to a conventional loan. I'm currently in the process of the refinance and it should be closed by 12/3/21.

Lessons learned? Challenges?

This project went very well. I learned on this project to adjust the home to the window sizes rather than get custom windows and have to wait 3 months for the windows to arrive. The height of the windows were all standard, but the widths needed to be adjusted. So, rather than waiting 3 months my team built the sides of the windows in to fit the standard (in stock) windows.

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

I worked with one of my private lenders. He is someone who has been lending me money for a couple years now. He is a retired GM employee, who is a fantastic, patient guy. He removes a lot of stress from my life.

I am looking for examples of hardship you can claim for subdividing land that does not conform exactly to zoning ordinances. The land is close but does not have the required sq ft. Its under by .2 acres.

I purchased 8 homes on 3 parcels. I need to subdivide the land into 8 individual lots, but need to claim hardship in order to do so. Please let me know if anyone has dealt with this issue before, and what are some examples of the hardship you claimed in order to accomplish this task.

Thank you BP community