All Forum Posts by: Tyler Watts

If anyone is looking for wholesalers in Charlotte PM me. Charlotte is a hot market.

@Elliot Criss

I personally have my Cap ex at 5% for my properties that I buy and do a full rehab on. Just from my experience and the rehab I perform on my properties and reading the forums I found 5% to be a good fit for me. Take all of the your variables into account, even property management. I manage all of my properties, but still take 8% off for that so when I do use one down the road it's not a big deal. Right now that "8%" is cash flow for me, I don't pay myself I use it to re-invest! Again your taking all of this into your calculation and it's a conservative measurement aka "worst" case scenario. Typically you'll pull more cash flow out than you predict, but taking this approach protects you. As you research and run numbers don't get overwhelmed or you'll be the zombie setting at a computer scared to death to make a decision. I review all the numbers and do my due diligence, but fall back on COC return. If it's >15% ( and no major red flags) I'm going to pull the trigger. Just my method and it works for me. With the market I'm in and the proprieties I purchase >15% COC return is not hard to achieve.

Having money in your account NOT making $ is the problem! Some return is better than 0.

Good luck!

@Elliot Criss Your numbers are conservative and as you learn I think you will be able to dial them in more but your off to the right start. Your cash on cash return will be higher, I would think realistically b/w 12-15%. Use some creative thinking and you can get to 20%. Charlotte is a booming market and depending on the area will depend on rent. You can use rentometer to help gather your rent rates. Also drive the neighborhood and get an idea of the comps. Is this an A or D neighborhood and look for properties that are available to rent and see what they are asking. Google properties to rent in your area and see what hits you get. The market is strong and rents are climbing. Downtown has developers left and right building apartments. 

Once you see the comps then think " How can my property stand out". Maybe it's cheaper rent. Maybe you supply appliances. Maybe the landscape needs to look nice. Maybe the renovations are better  (i.e. central heating and air vs.. window units). There are creative ways to stand out. It could be a combination of all of these.  The sky is the limit!

If your property is solid and working and stands out, vacancy will be more toward 4% if that. Capex and repairs won't be that high either if you fix them to start with which I would recommend. Nothing worse then having an issue with a tenant living there, trust me I've been there. It's like the world is coming to an end for them.

Interested in this a lot. In the same situation here in NC. Found a heck of a property. Diamond for sure. Starting digging and had an attorney say stay away as he couldn't get title insurance on it. I'm not one to take no lightly and haven't came this far to give up. If that was the case I'd be sitting on my couch eating chips and "hoping" i get rich one day. I've asked around and even went to my banker about this. The answer I kept getting was "you don't really know what you got until you buy it" and at the moment, I don't have that million in an account to gamble. It's still bidding off and my contractor and myself are keeping close eyes on it. He's bought multiple properties from this particular county and flipped to me with no problems. I've talked to the county who is auctioning it off and she can't find any red flags but "if" one comes up it's on me. Basically the attorney left with you can buy it and maybe never have an issue, but "if" the previous owner takes you to court it's going to cost you $ to get them to go away and if you can't get title insurance you won't get a bank to loan on it. Anyone have any guidance I'm all ears!

document, document, document. 

Sounds like you have  bully tenant which I would not renew the lease. But you can look at this as opportunity as well. Did the problem get fixed correctly by the contractor your tenant hired? If so, I'd consider paying just to make the headache go away assuming that is a fair price for the fix. Again, you have to remember your most valuable asset is your time, do you really won't to spend your time and energy over $360? I understand your trying to make a point and when you mix pride in it's hard but refer back to your most valuable asset, time. One hour with an attorney can chew most of that up. If your documentation is not 100%, I'd check the contractor and repair and if ok I'd pay but would document the situation and have the tenant sign saying ANY repairs moving forward must get WRITTEN approval from the PM or they will NOT be paid. Be firm and professional. This is your property, not there's and it has to be demonstrated.  Moving forward, this is something to learn from on future tenants and how important relationships are with them. There are some that just want to be a pain, but for the most part, if your a solid landlord, tenants will follow the rules but they have to know if they don't, there is consequences.  I purchase Boston butts every xmas and give to all my tenants just to wish them Merry Christmas and let me know I'm thinking of them. That $50 goes a long way, especially when a problem arises! Good luck. 

@Timothy Howell

Sounds like you've got the contractor deal worked out. That's a big plus. Shelby is a unique area. It boomed during the Mill era but with the closure of the mills this area took a hit. Makes for a solid rental market as mill homes are easy to rehab and there are plenty in the area. The market your aiming at is your upscale side and your in the right area to do it. Anything near the country club holds value just do to the name. I have not personally completed this process, but have looked at many properties in that area but my niche is buy and hold rentals so I have focused on that. Your spread seems good so the only variable I see is how long it will be on the market. 6 month rehab will put you listing it in Julyish which is when the weather is nice and people are out. 

Keep in the loop of the outcome, I'm interested to see your spread and the outcome if your willing to share. Good luck!

Timothy,

Good to see someone from the same area on here! I know the area your talking about and yes there is opportunity there. I would pay close attention to your rehab cost. $25,000 for a "full scale renovation" sounds low. To being that property up to the neighborhood standard will likely require more money. Anytime you deal with the older style homes that have been left vacant you will need to expect the unexpected. Sounds like the "big" things are covered but as you begin renovation you will find things that will need to be fixed. A solid contractor will be a big help in this and double checking your numbers assuming you came up with the $25k estimate.

I've only dealt with one hard money lender and he likes to view the property and follow the deal with you. I've never done a deal with him but likely will one day. The numbers seems good but your biggest variable is your rehab cost.

Good luck and let us know how it turns out!

still available?

Investor concentrating in the Shelby, NC -Gastonia, NC - Charlotte, NC areas! If any wholesalers have any deal please shoot them my way. Looking at SFR's to 50 unit complex!

thanks!

-Tyler

Yea contact an attorney. NC will want you to provide an address within the state that is your business address. It can be your primary house if that is where the business is. Attorney is your best route and you'll likely have to contact on in Cali and one in Carolina. I've got some in NC that can help you with that side of things. PM me and I'll shoot over there contact info.