All Forum Posts by: Trevor Baker

We just looked at a little house in Reseda, Ca that is a total fixer, and we know that. We know this is earthquake country, and this house built in 1950, and is still standing after several of them.  We also know this requires further professional inspection.   We're planning on submitting an offer on this house tomorrow and will stipulate a structural inspection contingency.

However, we noticed there are multiple cracks in the plaster throughout the house... in the walls & ceilings.  How likely are these to be superficial?  

@CJ Berina, @Tony Mai, @Alex J. Bekeza, @Samuel Pawlitzki, @Shayna Nadeau Thank you all for your insights and input!

After looking at the house today and running our numbers, we decided to pass. Our initial research uncovered that the house was purchased about 3 weeks ago by a mortgage guy from Washington state for $499K. So, he's just trying to make a quick $100K (less commissions and closing costs). Can't fault him for that.

The house next door is slightly smaller. It was purchased in January by a fix & flip company for $450K.

So, that just proves there are deals in the area in that more reasonable price range.

We do like the neighborhood, so we are going to dig in a bit deeper and find OUR deal.

Thank you everyone for your input!  My partner is going to check it out today.  If it looks good, we'll both go back tomorrow.

We've been presented with an off-market Fixer in Tarzana for $620K. 1362 sq ft  3 + 2.  7000 sq ft lot.  Detached 2-car garage.  No pool.  Built in the '50's (like most of the Valley!) Haven't been in it yet, but it looks like a solid house.  Needs updating... kitchen, bathrooms, flooring, landscape.  Could probably do it all for $50K.  It's north of the freeway, closer to Reseda.  Not on a major street.

A similar renovated home down the street just sold for $810K!  But, was that an anomaly?  I pretty crappy house close by sold for $450K.  

So, what do others feel the market is doing in Tarzana?  Are homes this size, north of the 101 getting into the mid to high 700's pretty easily?

My partner and I looked at a property on a fairly major street in Woodland Hills, CA over the weekend.  It's a small house in really bad shape that we see as a tear down.  It's on a 7700 square foot that we believe is zoned R2.  

So, our thought was... We demo it and build a new duplex there.  They're asking $480K, but we're assuming we could get it for around $430K.  A 2400 square foot duplex (1200 square feet per unit) at roughly $150 per sq ft to build = $360K  So, roughly $790K all in.

We estimate we can rent these brand new units for about $2500/month, grossing $5000/month.

We're not sure what the property will appraise for when done, but if we refi once it's done (BRRR) and pull $700K out, it looks like the mortgage payment + taxes & insurance would be about $4000/mo. So, we'd net $1000/month.

I know these are rather vague numbers, but does it make sense at all??

We are pondering the purchase of a property (and possibly the adjoining property) on a fairly major street in Woodland Hills. The first lot has a house in really bad shape so it seems like a tear-down. The second one has slightly better, but not great SFH. Each lot is about 7700 square feet and we believe they are currently zoned R2.

We haven't done any ground-up construction yet, but we're not afraid of it. So firstly, we are wondering what to estimate construction costs for a duplex on each lot. Or, do we look into changing the zoning and combining the lots so we can build a larger apartment building?

Lastly, what should we anticipate as rental rates in the Woodland Hills area, or where do we get that info?

Thanks!

We are pondering the purchase of a property (and possibly the adjoining property) on a fairly major street in Woodland Hills. The first lot has a house in really bad shape so it seems like a tear-down. The second one has slightly better, but not great SFH. Each lot is about 7700 square feet and we believe they are currently zoned R2.

We haven't done any ground-up construction yet, but we're not afraid of it.  So firstly, we are wondering what to estimate construction costs for a duplex on each lot.  Or, do we look into changing the zoning and combining the lots so we can build a larger apartment building?  

Lastly, what should we anticipate as rental rates in the Woodland Hills area, or where do we get that info?

Thanks!

@Rory Kinnear Thanks for your input.  We have put some thought into the buy/ renovate/ rent/ refi idea as a possibility.  Maybe do a rental-style renovation, which should be less expensive.  Then, wait for the market to turn in a few years.  Gotta look at current rental rates.

We're considering an off-market single-family house in Exposition Park neighborhood of Los Angeles.  It's a 1400 square foot 3+2 Spanish-style home built in 1935.  It needs a lot of work.  A burst water pipe under the house warped the wood flooring, so it needs all new floors.  With that amount of water damage, we are aware of the possibility of mold.  In addition the home is needing a new kitchen, bathrooms, electrical, plumbing, paint, landscape, etc. etc....  The detached garage in back has been converted to a crude, un permitted living area.

We haven't presented an offer yet. We feel this house needs a minimum of $80K (and possibly more) to renovate it. We are trying to estimate a valid ARV. Around the corner, there's a smaller (1062 sq ft, 2 + 1) yet completely renovated (to a very high standard) that's just gone on the market for $649K... but that's just the asking price. We're keeping an eye on this one.

We realize that the West Adams neighborhood is very hot right now, and Jefferson Park is turning, but we're not quite seeing that in the Exposition Park neighborhood.  The rest of this street has some decent homes and some not so great ones.

We think we might (might, might) be able to get this for $475K, though the owner said he already turned down a "soft offer" at that price.  Maybe a solid offer will motivate him.  Of course, we'd want a full inspection of the foundation and potential mold issue.  We could easily be int this property for $575K-$600K.  Is there enough room in this market to make a decent profit on this?

What's the consensus on market trends in this area? Any thoughts on ARV for this size house in this neighborhood?

@Kevin Lefeuvre  We haven't locked down the deal yet.  We don't want to spend that amount of $, find out everything's fine then lose the deal at the last minute.  We're working on that aspect now.  If we can mitigate our many concerns and lock down the deal, then we'll likely be more ready to spend the money for a proper inspection.