All Forum Posts by: Zachary Deal

Yep, as others have said when in doubt always contact to the city to confirm what you need to pull permits on. Good luck with the ADU and renovations!

Most investor utilize short term hard money debt to scale their flipping operations where the lender will fund 80+% of the purchase price and the rehab budget which can allow investors to work on multiple projects at once. Typically there are no prepayment penalties on hard money loans, so you can limit your holding cost if you're able to quickly complete the project and sell or refinance in a few months. If you're looking at the BRRRR strategy DSCR rate and term or cash out refinances are an easy way to refinance the hard money debt.

If you contract is free to come with you, that would be the best approach. Otherwise taking detailed videos and pictures for the contractor to get a good idea of budget should be sufficient to get a realistic budget. With your ARV it looks like you have plenty of room even if the budget is a bit higher than 125K.

Have you tried the classified section of BiggerPockets? That can be a great way to find vendors

Lots of people on here have great advice regarding location. I'd double check any addresses AirDNA for average projected revenue. Ideally you are exceeding the AirDNA numbers but it can be a good gut check on average rates/occupancy for that specific neighborhood, etc

For Medium and Short Term rental properties professional photos are always recommended. The extra cost is typically well worth the benefit. Also, a 2 minute video walk through can be nice to have for anyone wanting a more in depth tour.

I think it's a mixed bag. A lot of MTR investors use PMs but a lot also self manage as it is not nearly as time consuming as an STR. I could be wrong but I think that is reflected in PM pricing (middle ground rate between an LTR management fee and STR management fee).

Yes, being below 70% is generally much better. Typically hard money lenders will lend a maximum of 70% of the ARV so if you are below you will have more flexibility on the initial loan and the refinance (better terms or higher cash out) and of course more profit if you sell

Thanks for flagging Robert! I visit Warm Lake, Idaho every year (2.5 hrs north of Boise) and have seen Boise transformed over the last 25+ years. It's an amazing city and very underrated rental market in my opinion!

@Patricia Redsicker Congrats! Thanks for sharing. I've seen BRRRR investors have a lot of success in Baltimore making money on their DSCR cash out refinances after renovating distressed townhouses or rowhouses. Seems like a great strategy and I hope others keep up the trend!