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All Forum Posts by: Sheree H.

Sheree H. has started 14 posts and replied 64 times.

Post: Help with offer on OO fixer

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

Our situation recently changed and we need to move. So I've been looking for an OO home with an investor mindset, which has been conflicting. We plan on living there 2-3 years and then turning it into a rental. I'd like advice on this just-listed home.

It's in NE Atlanta, where every newly listed home has multiple offers within days, and goes pending in about a week. It has been listed for about 8 hours, and I've already seen the house. Comps are 236K and 222K. It's listed for 130K short sale. My personal max budget is 170K.

It has water damage, no mold (that I can see or smell), from what looks like a tree root messing with plumbing causing a backed up toilet. The yard is sunken next to the sewer clean out, which is next to that evil large tree. The bottom half of the drywall is cut off in half of the house's interior walls, and carpet has been removed.

There is also a leak in the ceiling from the upstairs main bathroom.

I have a fast agent, and I want to make my offer ASAP. I have no experience with rehabbing. Is it possible to get this house at 130K and fix it with 40K? Do I need to make a no contingencies offer (which makes me nervous because I don't have 130K cash in case my lender doesn't come through)? Can anyone in Atlanta advise me?

Post: New in Atlanta

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

Thanks Raymond B., Glenn Espinosa, and Gordon T.! Turns out there's an Atlanta REIA meeting Monday night; maybe I'll see you there Gordon.

Sheree in Atlanta

Post: Flipping family properties?

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

Thanks for your advice Mike. Good point on doing House 2 first to be more in control of the funds and transaction. Which gives me the idea that I may be able to even delay the subject-to purchase of House 1 until House 2 is finished, if we decide to go ahead with this.

I estimated very conservatively. The owner thinks House 1 will sell for 120 and House 2 for 170, but he didn't do any comps.

I walked through the houses today. Not quite hoarder condition, but getting there.

I'm getting nervous about taking on this project. You're right, the numbers don't add up unless I estimate high ARV, and I haven't calculated asbestos/lead into the rehab yet. I'm starting to feel like the best thing to do is sell the houses as-is.

Do any Georgia rehabbers have a recommendation for an asbestos removal and abatement company?

Thanks,
Sheree in Atlanta

Post: Flipping family properties?

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

Oh my gosh!!
Thanks Stephen.
Off I go to research asbestos.

Cheers,
Sheree in Atlanta

Post: Flipping family properties?

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

Correction to House 1: Loan of 100k.

88K at surface value feels like I'm ripping them off. But with all the rehab, I almost feel like I would only be breaking even on House 1.

Also, a thought occurred to me: would the property value be higher as one lot versus two?

Looking forward to hearing what you all think about this.

Thanks,
Sheree in Atlanta

Post: Flipping family properties?

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

A direct relative has two houses they're willing to sell me to wet my feet on. They are not investors; because of family situations, they ended up owning two houses, and now they're looking to move to another home that their son owns.

Since I'm new to this, I'm pretty sure my ARV and rehab costs aren't going to be dead on, but I took comps from within the last 6 months, and I've been reading through J Scott's rehab spreadsheets since he's in GA and our house prices are in the same range.

House 1: Split level 3bd/2ba, wood exterior, built in 1977. Loan of 150k with no other encumberances.
ARV 90
Rehab ~50k? Old wood paneling. The windows are those long rectangular un-openable kinds; should we change them? Basement pump floods occasionally. Bathrooms will need full remodeling. Needs gutters. Everything needs updating.
Using JScott's formula, MPP=8k (!!)

House 2: Brick ranch 3bd/2ba, built in 1975, full finished basement with another 3bd/2ba. House is paid off.
ARV 150k
Rehab 30K. Needs gutters. 2 bathrooms and 1 shower need re-tiling. Everything needs updating.
MPP=80K

The two houses are back to back. House A on a busier street, House B in a quiet established neighborhood. House A is right down the street from a top elementary school, feeding into a top high school. They are not open to selling only one. I am considering buying House 1 subject-to. Fixing and selling House 1 is priority b/c of the subject-to; I'm still considering whether to sell or rent House 2.

Does 88K sound like the right price? Are there legal hurdles to selling two houses in one transaction to a relative?

A giant Thank You and all credits to J Scott!!

Post: How I made $800,000 on one flip

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

I enjoyed your article. It's eye-opening to me how important base hits are, in gaining experience, establishing relationships, and building a reputation. Your quote below gave me an "aha!" moment:
"Even though I had none of my own money in this deal, I cannot overemphasize that this financing structure is only possible with experience, relationships, and a track record (remember all of those base hits you are using as building blocks?)."

Thanks for your story. Gives me a good goal to aim for!

Sheree in Atlanta

Post: Newbie questions: equity, ppl I need...

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

Ok forget everything I said before. I've been reading J Scott's articles and I'm going to use his formula of MPP = Sales Price – Fixed Costs – Desired Profit – Rehab Costs. While targeting distressed owners and buying subject-to.

I still don't understand how equity fits into any of this. Can someone explain why equity is so important?

And again, will a RE attorney take care of all title needs?

Well, I was all ready to start calling and had a goal of starting a deal by the end of this month, before I found BP. The more I read, the more I realize I don't know what I'm doing, and at this rate, that first deal is not going to happen anytime soon! *frustrated*

Post: How to research school districts?

Sheree H.Posted
  • Rental Property Investor
  • Atlanta, GA
  • Posts 67
  • Votes 26

Another site I use is schooldigger.com. Also second Greg's suggestion for using city-data.com for a good place to ask for subjective opinions and personal experiences.