All Forum Posts by: Ed L.

I think the Mentor thing is overplayed. Honestly If someone came to me locally and asked that I mentor them and share everything I know about Real Estate I'd be hesitant for fear of training my competition. Ironically I'd share anything and everything imaginable with someone on BP.. Go figure.

Read, read, read, and read some more on BP, all the answers are here and free..

Spend 6 months analyzing the new listings, pended listings, and sold listings on your local MLS to help get a idea of what is selling and not selling in your local area.

Break your city into grids and just start riding down every single road to help familiarize yourself with the different neighborhoods.

When you think you've found a deal post the basics of said deal to BP and let the community help you evaluate it. Most likely they will point out potential pit falls and shortcomings.

If you post photos of the property and dimensions they can even help you estimate what a contractor should be charging you to repair the property. i.e... $4,000 to replace the central hvac, or $2,000 to paint the interior, etc.. Not rock solid figures, but basic parameters to help guide/mentor you through the process.

Best of luck!

Yea I have no clue how my guy does them for so cheap. He works a full time job and does floor refinish and tile on the side. He also does my tile countertops. He recently increased his rate on the small kitchen counter top jobs from $75-$125. I fired him on the spot.... lol J/K....

I've had other contractors quote $3 per sq/ft which would be around $2100 on this house!!

Here's a few photos to give you a idea of the color once they are poly'd. Be fore warned that the poly is going to bring out all the details, dings, and gouges you were unable to get out while sanding. I imagine a stain would help mask the imperfections, but I like that it adds character to the old floors.

Forgive the rest of the house- This was step 1 in the remodel so everything else looks like crap. I spent half the day today stripping wall paper in the dining room.

Here's a before and after of one of my previous rentals.

Notice the dark spot where the sofa was. Couldn't see it at all till the poly went on/ same thing happened in the living room of the current house.

@Account Closed

That's a good point regarding the time horizon for lower income properties. I think a lot of people fail to realize just how long 30 years is.

That's my entire life + 4 years lol....

I never base my rental return rates on a mortgage longer than 15 years.

Depends on if you want to flip or buy and hold.

I originally used a smaller local bank for flipping. Basically they would set up a line of credit using the subject property as collateral.

Quick closing, Interest rates were 6%, 15% down payment, interest only 1yr balloon with semi annual payments. Think they charged a 1% origination fee. Sometimes had to have appraisal, and lenders title policy.

Now I have a pretty decent size Unsecured Line of Credit with another small bank. It makes life even easier as I don't have to hassle with a lender at all. No origination, appraisal, no down payment, or lenders title policy. Interest is around 5% paid monthly. It's basically a big credit card with a great interest rate.

If you want to buy and hold you need to find a lender that will do fixed rate fannie mae financing for investment properties. A lot of banks don't offer these loans and will push 5yr balloon loans which are a lot less desirable to me.

I'd pump the brakes a little at that price and amount of repairs needed.

There are several duplex's on my MLS with identical numbers that sellers can't seem to unload.

By time you factor in Vacancies, Tenant Turnover expenses, Maintenance, and Capital improvements your returns are going to take a pretty good hit.

Demand seems to be the big issue with Duplex's in my area. I had a nice duplex under contract last year that was 2b/2ba on each side. Had it under contract for $59,000 IIRC. Market rent was around $650 per side.

My other properties are 2br 1ba single family homes that rent for $750 and they rent within a week. I decided to run a ad as usual for the duplex units on craigslist before purchase to gauge the demand and quality of tenants and it was enlightening to put it mildly.

Every person that inquired about the duplex units either lacked the ability to speak proper English or hung up shortly after they realized it was a duplex instead of a single family home.

I had it listed for 3 weeks while the bank sorted out title issues and basically my option was to rent it sec 8 or no tenant.

I backed out due to the title delays, but honestly looking back I probably should have bought it and dropped the rate to $550 per month. Numbers would have still been good at the contract purchase price.

Could be a totally different experience in your market, but that's my first hand account of dealing with a duplex vs Single Family.

I 2nd the Poly only!

My floor guy sands and poly's my 3/1 cottages for about $600 with him providing all the materials, and it always looks great.

Love solid wood floors, can't beat the combination of aesthetics and durability.

Daniel,

It's hard to say where a neighborhood is going. Especially when you are investing from out of state.

Good middle class B neighborhoods today are pretty likely to be C neighborhoods in 10-15 years.

In my market homes that were built in the 70's, 80's, and early 90's can be bought for around $100,000-$130,000.

The problem is people that are buying these older homes in that price range are just scraping by. They are buying with FHA loans and putting almost no money down, and have little to no savings. The problem arises when the 20-30yr old home needs a new roof or paint job, and these people don't have the financial means to make big ticket repairs and maintenance.

It's basically a bunch of people that should be renters are now homeowners thanks to federally subsidized loans. In all actuality they are still renting from the bank, but there's no landlord to make repairs and keep things in order.

Once the homes start looking bad the values start to slide and now there are people underwater and foreclosures stat occurring.

So yes there is a fair amount of uncertainty and risk associated with owning a home for 30 years.

I personally like to buy homes that were built in the 50's & 60's in neighborhoods that have already experienced a decrease in value. These neighborhoods have already peaked, declined, and bottomed out. They are centrally located in town and are safe/ not war zone neighborhoods.

I'm currently up to 5 single family homes and I can unequivocally say that I would never recommend owning rental property out of state.

I'd highly recommend turning every stone close to home before venturing away.

As usual there are plenty of variables. You will be required to disclose the foundation problem which based on my experience has a negative impact on future sales price after the repairs are complete.

If comparable move in ready homes in the neighborhood are going for $70,000.

You feel the home can be remodeled for $10,000-$15,000. I'd say budge no less than $20,000 if this is your first flip.

Foundation repairs can be as simple as $500 to add support to a raised foundation home- to over $20,000 to add concrete pilings and lift a sunken slab.

Based on what You know I'd figure $20,000 on the rehab + $5,000 for foundation repair and add a 7 day inspection contingence to your offer so that you can have time to have it fully evaluated.

Based on that I'd be offering $25,000 for this property contingent upon inspection approval.

What kind of properties are these?

What are the monthly rents?

Are repairs needed?

Is current owner providing any utilities?

Taxes & Insurance?

Recent Comps?

Lots of variables that can't be honestly answered based on the limited amount of information provided.

Lmao, thanks for sharing, it brightened my day!

If it's really a deal I wouldn't hesitate to do business with the guy... At least you know on the front end what you're dealing with.

More likely than not he's overpriced and tired of "low ball offers" which are probably not really low ball offers in all actuality.