All Forum Posts by: Ethan Giller

Neither a real estate attorney nor a real estate agent is required, but if it's your first purchase in the area then having a real estate agent assisting with the transaction will make the process much easier.

Check out @Joe White, he runs a great operation.

John Sacks-Wilner (gopmr.com) is great too.

Hi @Melanie Z., so sorry to read about everything you're going through. It really does sound like your best option is to contact a real estate attorney who can help you sort through some of these issues, rather than trying to tackle everything yourself. If you send me a private message I have a couple that I could recommend, or if you look online on websites such as avvo.com then you can find one on your own. Good luck!

Figure $150/sq ft build cost for mixed use development in Philly, excluding soft costs (holding costs, financing costs). Yes, you can get it done more cheaply but if you're asking for a back of the napkin calculation to see if the deal pencils overall, best to use that number.

@Lewis Colon I would strongly advise against buying your first investment property at a sheriff's auction in Philly. These properties often have complications on title, and may also have zoning issues or occupancy issues, and they are harder to finance. There are some deals there but these days not as many, and it's more of an advanced strategy and generally a gamble even so, very hit-or-miss and you will be bidding against 100-200+ other investors, 75% who are experienced and knowledgeable, 25% who are newbies and liable to overpay. Much better for your first properties to buy from the MLS or a wholesaler where you have guaranteed clear title, and time to do due diligence on the other issues.

Really would need some more information. Such as square footage of the property, what the foundation you referenced is for, exact scope of work ("gut rehab" means different things to different people), desired quality of the finishes, how you are trying to complete the construction (hire a property management firm, hire a GC, or sub out the work yourself for example).

The most likely answer is that yes, you can probably get away a $40K rehab to get it rent-ready if that's all your budget allows even if it is mostly a full gut. But it's possible that you'll need to cut some corners on quality of finishes, or by using less qualified contractors, or by GCing the work yourself, or the rehab taking a long time, or cutting back a bit on the scope of work, etc.

If it's a true gut rehab (i.e. taking it down to shell condition then replacing everything) then depending on the square footage and the setup and if you're trying to do this from out of state and complete with desirable finishes, you will probably want to budget more like $50-80K (I'm assuming this is around 900-1,200 sq ft).

But again, really need to look at more information to be sure. There are single family properties in that area of West Philly that are under 800 sq ft or ones that are 2,000+ sq ft. And if you need to replace water and sewer lines and pour a concrete slab for the yard and fence the backyard that's around $10K+ out of your budget right there without even touching the interior.

@Eugene Carelli in terms of the GC, you will have better luck finding one once you have a property owned/under contract that they can walk through and bid. Getting one on board without any confirmed work ready to go is hard.

I would recommend signing up for HAPCO and DIG, two local Philly organizations where the members often share contractor referrals and recommendations.

That being said, it's a tough time to get started because Philadelphia is a hot market so most of the GCs who are knowledgeable/reliable/affordable have steady work lined up already from repeat investors who they've worked with for years.

It's still doable to find good contractors out there, so I don't mean to discourage, just know that you will have to go through a lot of ones that are sub par in multiple ways before finding ones you can rely on.

The "best" is the one you can form a good working relationship with, and who is a good fit in terms of personality, expectations, and the types of deals you are doing. There is no one objective "best". 

One may have lower rates but be slower to fund or have stricter lending requirements, one may be easy to work with and quick but more expensive, one may have looser lending terms, one may be smaller and only do certain types of deals but be a good match for your business model, etc. 

Your best bet is to contact a number of them, have a discussion about your specific situation and needs, and see who you think you can develop a relationship with for continued business.

@Joe White and John Sacks-Wilner (gopmr.com) have a great operations set up and are very focused on customer service, but they doesn't operate in all areas so it depends where your rentals are located.

TCS (tcsmgt.com) and Welch Group (welchgroup.net) are larger ones in Philly, they know what they're doing.

@Joseph Scorese has a lot of connections in the Philly investor community and is a good person to speak with too.

Unfortunately, you can now only transfer 74% percent ownership of an LLC within a 6 year period. More than that and transfer taxes are due.

https://www.jdsupra.com/legalnews/the-party-s-over-changes-to-the-21677/