All Forum Posts by: Tyler Fontaine

Ehh it depends. If you can lock it up and have a full scope of work then getting a contractor shouldn't be too bad. The holidays don't help but if you call around enough and ask for referrals you should be able to get someone who is willing to work.

Given it's your first project I would be cautious and very conservative rehab costs. it will cost more than you think for sure. Instead of social media, start combing through the home depot and lowes apps and get an idea daily on pricing of things. 

Call around and see if you can get rough quotes on electrical stuff, HVAC stuff, flooring, and so on.

I agree, I think it would be necessary to have that document drafted. 

You should just connect with your local RE attorney that you use or can get a referral from through your network and see if they have one that they can provide you with one.

Definitely going to want to check with your local laws, maybe call Sec8 to confirm.

I live in RI. Some of the cities/towns allow the transfer, others make the application happen again.

Hey everyone, there is a single family rental coming up. It has a saltwater in ground pool with it.

Does anyone have a pool addenda for a lease that they could provide to me? Preferably one they or their peers have already used and is tried and true.

First off, i'm sorry for your loss. That's super tough. I hope you and your family stay blessed. 

Lots of moving parts here. So first you have to talk to the attorney handling everything and see if the houses are in probate. If they are you will still be able to inherit the properties but it's going to take longer to get things properly thought the court system and such.

Next get with your attorney and see what vehicle will be best to move the assets into for you to make money, share ownerships, attain loans etc. Could be a trust, an LLC/multiple LLC's, and so on. Make sure you set it up right if you and your brother will be receiving proceeds. You can also involve an accountant/book keeper on this so you can get paid, minimize your tax burdens, and keep money in the business... also be sure to talk to your attorney about the quit claim deed. Those types of deeds do not protect the "new owner" if there is a cloud on the deed of any kind. Be sure that is not the case if you choose to go that route.

A heloc is a great tool if you can have access to it in order to do the updates needed. Your immediate primary goal should be to stabilize these assets and get top gross rents asap. Then you should use the funds/loans/what ever you can get to try and grow the portfolio with what you have. Next would come the SUV for the mom. Make sure you can grow and also then use the cashflow for liabilities as a bonus.

If you're new to dealing with tenants you will want to become friends with an investor who is who can help guide you. Also, a property management company is very much worth considering. How ever you do it, remember this is a business. Treat people fairly, make the tough calls, don't get too emotional. Tenants will try to make you feel bad, skirt standards, and etc. Don't play that game. Be firm but fair.

In terms of your accounting... don't play hero and do it yourself unless you TRULY know what to do. Get a book keeper to organize all the monies in, monies out, monies to the business, monies to you and your family, personal funds versus business funds. Then get a good accountant. They will make sure you save the most and mitigate errors.

Another benefit to doing this is that your money in the "paper world" - what shows on taxes, in-flows/out-flows on a P&L, balance sheets - will all be in order. This will make it much easier to attain loans through an LLC or even personally once you have control over the units.

Cornerstone Commercial Capital in Warwick RI

Renovo Financial

Sounds like a challenging problem. 

I agree that the the issue could be the agent if they cant get the traffic, although you said it was good. The layout could be the issue.

Perhaps the other part is you probably ran the numbers with an ARV from a few months ago and not from 3 months from this december. Although prices are high, there is a downturn coming/already here in the market. So the price will have to reflect the now near future value of the house. Then the list price should be below that number so that you can create traffic and get an auction effect.

It may be worth considering pulling the listing then relisting it in January with some photos rearranged, different listing description, etc. Then price the listing below where the market is to drive traffic again, create an auction effect, and hopefully get offers over asking.

We recently finished a flip in our market. Direct comps showed we could likely get a sale price of $330-340k. So we listed at $319... 17 people at the first open house. 10 at the second. 13 offers in hand, 5 of which are at $330k and 2 of which are at $340k
 

Fair question. Lots of avenues in RE to make money. I can see why you are exploring all options.

Ill start with no matter what, just make sure you execute. Don't be stuck in analysis paralysis. Eventually you just have to pull the trigger, jump in the deep end, and get started. 

Now, I will say there is a lot of nuance that comes with RE but especially the commercial space. One place to start is to decide if you want to do residential commercial, retail, mix use, and so on. Plus and minuses with all of them.

Then I would be sure to get a realtor who specifically works with commercial. Same thing for your lender. The contracts are different, the funding infrastructure is different, how the asset is valued is different. You want to build your "team" with people who are niched into this and don't just do it casually for a paycheck.

Next, I would say you are correct. The barrier to entry into to commercial is much higher. You can only get into a deal in a few ways. Bring the deal to the table, fund the deal, have the knowledge to guide the deal, or be the person who quarterbacks it and makes sure all the parties involved are doing their parts. You could look in your local area and see if you can intern/work for free/get an entry level position with someone who already is actively having success investing in commercial. This way you can earn your stripes, learn, and potentially build seed money/relationships needed to get into a deal yourself and get a piece of the action.
 

Personally I started with a house hack to lower my expenses. Now I graduated to flipping houses. We will use the proceeds from the flips to build seed money to get some more residential rentals so that my expenses for my personal life goes to zero. The next step will be to trade in our portfolio into a larger resi commercial building or to use the money to simply buy additional units to add to the portfolio. 

Im a realtor, I work at a property management company, I have network of commercial/residential/private lenders, a list of contractors, a phone book of other investors who are doing the same things we are, a couple good attorneys, a book keeper, and a killer accountant. This took time to build these relationships but the machine if you will has been built to be able to take on much larger deals in the near future once we stack some more capital to invest with. I think building your network so you can have the ability to execute properly is the number one priority other than getting the money to make a move.

Glad to see you want to venture into STR. Thats a great way to make cashflow.

Couple things I'd be checking before anything.

Make sure the municipality you intend to invest in allows STRs and they dont have plans in the works to start limited or even eliminating STRs. I live in Rhode Island. Some of our ocean cities and then sub-cities surrounding the capital Providence is beginning to try and restrict the amount of STRs, the geographic locations they can be in, setting up legislation that requires specific permitting use, and so on. 

Next, I would connect with your local REIA and see if there are other investors who are already doing STRs in the area you want to be in. See if you can pick their brains for advice. Then I would ensure you come up with a system as to how you will handle giving remote access to renters (digital locks with changeable unlock codes), create a one pager of "House Rules" for renters as to how to handle the use of the property (do they have deck access, rules for the pool/jacuzzi, instructions for wifi access, emergency contact numbers, lists of local restaurant's/bars/entertainment, how to check out properly and the condition they should leave the unit in, etc.), line up a cleaning company and someone who can restock the place with cleaning goods/towels/if you provide complimentary snacks etc.

Not 100% sure on the recommendations since i'm not in the area. I would check with my local REIA and ask the other investors for referrals for this. They usually have in person meetings you can attend and ask for help or they have a forum/FB group where you can ask for a referral there.

In terms of your quotes, generally if they are super high - it's because the contractor doesn't want to take the job because of the level of difficulty/work load in my experience. Basically their saying, " I don't want this job but i'll do it for X..."

Another informative piece would to be to ask the local investors in the REIA what they have paid recently for HVAC work. Your quotes may not be far off in comparison if everyone is paying a similar amount. Material costs are up. Given the time of year, demand for HVAC work is through the roof as we are seeing winter finally kick in to gear. The quote they're giving could be a reflection of that.