All Forum Posts by: Clarence Johnson

 Thank for staging and holding advice.  Definetely will take heed to the best and worst case scenarios you suggested.  Based on window cost in Canada I may be in the wrong business lol.  A few thousand dollars in LA can get windows installed with trim.  My family deals with manufacturers thst hire out contractors to do their installs.  Also, thanks for staging advice, that can make a large difference in moving the property fast.

 No worries, I would rather you guys break the deal down on here than for me to lose my shirt lol.  I truly do appreciate all imput.  When I say homes are selling for $400-420 untouched I mean in liveable but not upgraded condition.  This house is not liveable; several broken windows, squatters were evicted within the month, no water heater, no closet doors etc.  

Jeff made some very valid points but his full gut rehab is in Lennox (only new to market for $440k with guest hs im Inglewood) where my flip is in an area where homes are selling $400-420k untouched.  I actually rehabbed a duplex in the same area 3 years ago for about $25k as a buy and hold investment,  so I was basing my construction budget on that project.  Jeffs insight did just make me adjust our offer amount and my partner and I greatly appreciate the time and effort you put into analyzing our deal.  He actually was surprised that a stranger in this industry full of sharks would reach out to help.  Comps were pulled from a 1/4 mile radius within 45 days.  Jeff, can your company offer competitive terms on the loan?  We are not locked in until later this week.

 Hey Kristine, I know my post was a little disjointed but I did cover the int/ext painting and front and backyard landscaping under scope of work.  How do you feel about the listing hitting the market in Oct-Nov.  Do you think pricing or holding time would decrease/increase?  Thanks.

Wayne,

My inspector said that he estimates repairs to be about $30k.  I definitely thank you for reminding me about property tax, insurance, and utilities.  The aforementioned can easily add up and eat away at our profit.  We will add another month to our holding time just as a cushion.  We will also lower our offer price around $15-20k.  How do you feel about our listing hitting the market near the holidays/slow season?  

Thanks!

Total expenses (purchase, holding, points/int, rehab, and resale): $400,500

Min comps are are $440,000

$40,000 profit

Forgot to include: 

-closing cost at $10,000 (will attempt to have seller pay)

- $11,000 in selling agent commission (in the event that its sold by outside agent)

Total expenses (purchase, holding, points/int, rehab, and resale): $400,500

Min comps are are $440,000 

$40,000 profit

Hello to All,

My business partner and I (both Realtors in southern Ca)have decided to take the plunge and purchase our first flip. After running the comps and walking through with my dad and Uncle (both in the business of property maintenance) I have decided to pay for an inspection today to make sure there are no unforeseen issues. I'm in communication with the listing agent and he is very receptive to working with us. Please analyze the deal and the proposed terms of our hard money loan, all input, recommendations and suggestions are welcome. Thanks in advance!

Home Specs: 3/1.75 1500 sq ft, 5400 sq feet lot

List price: $375,000

Purchase price: $340,000

ARV:$440,000 (comps verified with homes sold in 1/4 mile radius in last 30 days, not to mention a few pending listing at $460ish)

Rehab: $20,000

-Scope of work:

-Paint int and ext

-finish original hardwood floors 1200 sq ft

-new windows

- install 1 ext double door

-landscape back and front yards

-bath1: new shower pan/tile, vanity, bathroom flooring, light fixture

-bath2: epoxy coat tub and add tile border, new vanity, new flooring, light fixture

-3 new mirrored closet doors

-1 water heater

-kitchen tile

-retouch white cabinets and add modern hardware

-5 int doors

-door hardware, hinges, electric plate covers

Hard Money Loan Terms: $300,000 with 3.5 points and 12% interest

$40,000 cash for purchase

$11,000 possible payout for selling agent commission

$9,000 closing cost (will attempt to have seller pay closing)

$10,500 cash for hard $ points

$9,000 holding for 3 months (1.5 month rehab, 1.5 month market and sale)

The largest concern is the shower pan in the bathroom caused flooding and destroyed a portion of the bathroom subfloor, I made sure to mention to my inspector that I need him to verify that there are no signs of mold under the home. The other concern of mine is

that there was a fire in the home (which explains why the kitchen is practically new) and I am having the inspector look into the attic space to ensure there is no hidden fire damage. My last concern is making a purchase in early Sept means that my listing will hit the market Mid Oct-Early Nov. I would like to know if the experienced flippers break around this time in consideration of the winter market slow down.

Once again, any and all questions, suggestions, criticisms etc are welcome, the inspection is being conducted as I type. Also, if anyone has a hardmoney lender with more favorable terms please give me their contact information.

Hello to All,

My business partner and I (both Realtors in southern Ca)have decided to take the plunge and purchase our first flip.  After running the comps and walking through with my dad and Uncle (both in the business of property maintenance) I have decided to pay for an inspection today to make sure there are no unforeseen issues.  I'm in communication with the listing agent and he is very receptive to working with us.  Please analyze the deal and the proposed terms of our hard money loan, all input, recommendations and suggestions are welcome.  Thanks in advance!

Home Specs: 3/1.75 1500 sq ft, 5400 sq feet lot

List price: $375,000

Purchase price: $340,000

ARV:$440,000 (comps verified with homes sold in 1/4 mile radius in last 30 days, not to mention a few pending listing at $460ish)

Rehab: $20,000

-Scope of work: 

-Paint int and ext

-finish original hardwood floors 1200 sq ft

-new windows

- install 1 ext double door

-landscape back and front yards

-bath1: new shower pan/tile, vanity, bathroom flooring, light fixture 

-bath2: epoxy coat tub and add tile border, new vanity, new flooring, light fixture

-3 new mirrored closet doors

-1 water heater

-kitchen tile

-retouch white cabinets and add modern hardware

-5 int doors

-door hardware, hinges, electric plate covers

Hard Money Loan Terms: $300,000 with 3.5 points and 12% interest

$40,000 cash for purchase

$20,000 cash for rehab

$10,500 cash for hard $ points

$9,000 holding for 3 months (1.5 month rehab, 1.5 month market and sale)

The largest concern is the shower pan in the bathroom caused flooding and destroyed a portion of the bathroom subfloor, I made sure to mention to my inspector that I need him to verify that there are no signs of mold under the home.  The other concern of mine is

that there was a fire in the home (which explains why the kitchen is practically new) and I am having the inspector look into the attic space to ensure there is no hidden fire damage.  My last concern is making a purchase in early Sept means that my listing will hit the market Mid Oct-Early Nov.  I would like to know if the experienced flippers break around this time in consideration of the winter market slow down.  

Once again, any and all questions, suggestions, criticisms etc are welcome, the inspection is being conducted as I type.  Also, if anyone has a hardmoney lender with more favorable terms please give me their contact information.

Dawn manages a duplex in the area for my client and recently consulted wwith my parents to manage their 10 unit.  Shes a very knowledgeable manager and I often ask her management questions about my own tenants and property.  Tell her Clarence referred you.

Dawn (310) 863-0445