Positive,
I’m just wondering…do you ever let your wife win an argument?
Man, you and Pete gettin at it in at least two current threads. I can barely keep up.
It’s pretty late now so I’m not going back over the numbers on your deal. But I am curious about some things. From past posts, either you or fdjake said you’re a rehabber. Are you just so busy with other projects that you can’t get to this one? I don’t see any advantage to dragging this out. With our houses, I try to turn them as quickly as possible because so far I’ve been pretty successful at having another deal waiting in the wings while I’m completing the house I’m currently working on. I just spent about 20 hours this weekend over at the current project…some of that my wife and kids were there for. Our kids had a good time today playing over there. My son was using some tools to build some little things on his own from my scraps. We’ve bought 8 houses since last Dec. We’re closing on another this week. Of those, seven are rented, I’m about finished and ready to rent #8, and I’ll start working on #9 soon. If I just had the “it’ll get done when it gets done and I’ll post the numbers when I’m done” mentality, I’d have a bunch of empty houses costing me a lot of money. I have a full time job and this is all taking up a lot of my time, but I look at this as a temporary sacrifice that could change my life later by allowing me to semi-retire after I get out of the military.
You’re good at searching and posting quotes from previous posts. If you spent some of that time at that house - could you get it done pretty soon?
BINGO!!!
NO more phone calls WE HAVE A WINNER!!!
GREAT POINTS!!
WHO…WHO spends 11 months flipping a COTTAGE when they CLAIM to be a PRO re-habber???
NONE of it makes any sense.
And more and more people here are SEEING THAT!!
Justin0419,
“I’m just wondering…do you ever let your wife win an argument?”
Lol… well, I’m fortunately lucky to be married to a wonderful lady… we have one of those relationships where we can almost “read each others mind”… Like all couple’s we may disagree from time to time, but we are very rarely disagreeable with one another… that’s just us, though…
“From past posts, either you or fdjake said you’re a rehabber. Are you just so busy with other projects that you can’t get to this one?”
Yes, I do remodeling as my regular work… and we are one of those contractors who Fdjake says on the one hand says are not remodling homes, but then out of the other side of his mouth says they have works a couple of months out… Knock on wood, we are one of the ones keeping busy.
This is our first flip, and if I was using a crew, depending on inspections, it would have have been a 30-day project… It would have also increased my costs on this project by five-digits… that said, while I have many years experience remodeling, I’ve never flipped a house before. I wanted to track all the pitfalls, develop a costing spreadsheet specifically for it, and take care of some personal goals…
I’m a deliberate person… so while it may take time to do our first flip, that won’t be the case with subsequent flips…
“I just spent about 20 hours this weekend over at the current project…some of that my wife and kids were there for.”
My wife works on the weekends, and is also currently at school for her Masters during the week, so we have our own unique scheduling challenges…
This project ended up being a complete gut, so it was not an environment for our younger kids… It’s also alot easier to run interferance with both parents around, so that does not work for us…
"I don’t see any advantage to dragging this out. "
Legitimate critique… I never said it wasn’t… we just have our reasons… It all comes down to maximizing what we are getting out of this property on a personal level and financial level… time will tell how much we made out on the financial side of things.
“I have a full time job and this is all taking up a lot of my time, but I look at this as a temporary sacrifice that could change my life later by allowing me to semi-retire after I get out of the military.”
Like I said, this a side investment for me… as long as I realize a good ROI that is all that matters. Our strategy is FLIP / FLIP / Buy Rental Cash… repeat.
Justin, as an example, you may be financing your rentals, and that may work for you, but our goal is to own our rentals cash. It just increases our ROI… which is the goal of all this…
“You’re good at searching and posting quotes from previous posts. If you spent some of that time at that house - could you get it done pretty soon?”
It doesn’t take me long to post… and searching literraly takes less than a minute… I do it at times when I wouldn’t be at the investment property anyway, for whatever reason… If you look at the user stas, I actually spend LESS time than the average person… as an example, your stats read - 31 days, 12 hours and 35 minutes for 962 posts since January 2008, whereas my stats read - 5 days, 21 hours and 22 minutes for 638 posts since October 2007…
I don’t know, maybe some people hunt and peck on the keyboard, I don’t know…
Thanks for the legitimate questions… From your perspective, aside from the schedule, I would be interested in your thoughts on the numbers on the deal… just ignore the predictable Fdjake post that is destined to come next…
Yep,
You got that right…I LOVE the EXCUSES…ONE after another…AGAIN…JUST IMAGINE HAVING BEEN A PARTNER ON THIS LITTLE GEM with JOKER here!!! :banghead :banghead
I just thought I remind everyone of the EXCUSES we’ve been fed so far in this little fairly tale…
On the missed termite infestation in house…
That was the INSPECTORS FAULT!!! Does anyone here actually BUY this BS??? Here we have a PRO REMODELING CONTRACTOR :bs :bs That leaves the INSPECTIONS on HIS investments up to the JOKERS that call themselves INSPECTORS???
In my experience, INSPECTOR = FAILED contractor!!! Without exception…EVERYONE of them that I know could NOT survive as a CONTRACTOR, so they took an INSPECTORS JOB for the PAY CHECK…Home inspectors are even worse…These guys can come from ANY back ground. What type of PRO remodeling contractor isn’t under that crawl space HIMSELF before writting that CHECK??? Your answer???
An IDIOT…That’s who…
He can’t finish it because he has a wife and kids…
AGAIN…Did he ACQUIRE his wife and kids AFTER September 08??? Because at that time, this project was going to take him 6 months to finish.
Maybe it was a MAIL ORDER RUSSIAN BRIDE with built in family???
“With a CREW this would have been a 30 DAY PROJECT, But that would have increased my costs by 5 DIGITS”
I guess the 5 digits you’re losing in TIME and HOLDING costs is MONOPOLY MONEY :rolleyes The other GEM here is your REAL ARV from the first post which was $65K to $75…Now we’re up to $85,000 during the worst financial MELTDOWN since the 1930’s??? :bs :bs :bs
“This project was a complete gut so it wasn’t an enviroment for kids”???
I guess the YARD wasn’t either…Again ANY excuse he can find…He has an answer for every question asked here…I guess BABY SITTERS don’t exist in NEVERLAND. It’s also apparent that the “5 FIGURES” he would have spent having a “crew” do this job in 30 days wasn’t worth all the FREE TIME he would have NOW had with his family!!!.. See this is what smells like BULLSHT around here…He lays out these TURDS and doesn’t even THINK. Not only would this job have been completed…He would have had any PROFITS locked away, or even BETTER in ANOTHER property… He says he did it this way to LEARN??? Learn what??? Suposedly HIS crews would have done the job…He can’t LEARN while he PAYS guy’s to swing hammers??? This is what I’m talking about…IT DOES NOT ADD UP…This story is FULL of holes…A Pro Hab contractor can’t break off his CREWS in the WINTER during the worst economic disaster this country has seen in 60 years to bang out a 30 day job???
Come on…sell the BULLSHT somewhere else…
Our goal is to own our rentals CASH…OH REALLY??? When do you figure that might happen??? 2032???..Because IF that’s your strategy and you can’t get ONE FINISHED… How’s that going to work for you with MULIPLE projects going???. I guess the wife and family will VANISH during any future flips.
Then when asked about the TIME he spends here while he’s sitting on an UNFINISHED INVESTMENT???..His response???
We get a break down by the MINUTE of how long JUSTIN has been on REICLUB??? JUSTIN has purchased and COMPLETED… EIGHT HOMES SINCE DECEMBER!!! All while Positive has been UNABLE to complete ONE in an even LONGER time period…
Then when that excuse is seen as a joke we get fed the CUT & PASTE excuse…Appartenly his LIGHTNING REFLEXES allow him to respond to these topis at speeds mere mortals are incapable of…When JUSTIN remarks that all that time could be spent FINISHING his flip…He responds that other people must just hunt and peck on the keyboard???
This JOKER has EVERY EXCUSE IN THE BOOK. (Hey at least he’s got SOMETHING!!!)
I’ve seen BULLSH*TTERS in construction…This guy is in a class by himself…
The bottom line here is this…He’s trying to BULLSH*T people who have DONE THIS…They KNOW this doesn’t make ANY SENSE…They understand that until that CHECK goes into your BANK ACCOUNT and CLEARS…You have a LIABILITY…NOT an INVESTMENT…An INVESTMENT is only worth what SOMEONE ELSE is willing to pay for it…AS of right NOW Postive has a torn apart home that he’s into for over $30,000…It becomes a SUCCESSFUL INVESTMENT when SOME ONE ELSE is willing to pay MORE than he has spent on it…That CAN NOT be done until the project is complete…It becomes a LOSER investment if it CAN NOT be sold for a PROFIT. The LONGER he farts around the more the odds favor something going wrong…That’s the FIRST thing you learn as an investor…That’s why JUSTIN worked his @SS off to COMPLETE 8 properties (rental ready) since December…He knows what a RISK having an EMPTY house is…
As INVESTORS we all know this…He’s kidding himself…But NO ONE ELSE!!!
I posted an article about the new APPRAISAL RULES that are KILLING 1 out of every 4 deals because banks are now REQUIRED to use the LOW comps in the area…NOT ONE WORD OR QUESTION FROM HIM ON THIS??? This could LITERALLY keep his potential buyers from getting FINANCING on this property!!!
Stand by for MONTEZUMAS LIGHTING BLITZ OF CUT / PASTE & BS EXCUSES!!!
Or…Maybe he’ll attempt to CHANGE the SUBJECT…AGAIN!!!
" just ignore the predictable Fdjake post that is destined to come next…"
As predicted… :biglaugh :lol :rolleyes :bs
The funny thing is, you actually think people are going to read the same thing over and over again… almost 800 words to say the SAME straw man… :banghead
I wonder how long THAT one took… :biglaugh :lol
“Maybe he’ll attempt to CHANGE the SUBJECT…AGAIN!!!”
Lol LOL LOL… you think people really fall for this… are you THAT warped??? nice try Jokester (nice try at reassigning your nickname to me) :biglaugh :lol
Like I said…
NOT A SINGLE ANSWER to what is becoming OBVIOUS…
But you keep right on BULLSH*TTING yourself…
Because YOU are the only one who believes a WORD OF IT!!!
Fdjake,
It just dawned on me… :surprised you ACTUALLY THINK I give ANY consideration to YOUR opinion when it comes to real estate…
Your ONLY straw man on this deal (i.e. - schedule) is just white noise… When the property s listed/sold/LO’d or rented, the NUMBERS will speak for themself… Just like it doesn’t matter what you bought your Ford stock for, it matters what you sell it for, otherwise, you wouldn’t be talking about FORD being such a great DEAL, even though you HAVEN’T SOLD IT YET…
You, as a self-proclaimed expert, have pathetic math skills from what YOU’VE posted, and when you tried to change THAT to work in your favor (i.e. - use the low number and then you used the HIGH), you ended up calling YOURSELF a STROKER based on your OWN definition… can you not see how pathetic that is…
Even if things TOTALLY tank… and I could only sell this NEW house and NET $55K sans selling expenses, that is STILL a double digit RETURN even AFTER TWO years… Now, mind you, two houses in the COMPS sold for $75K & $95K on the SAME STREET, for AS-IS condition, NOT new…
I respond to you, point by point, primarily for the benefit of others… and to DEMONSTRATE, time and time again, your misleading FALSEHOODS, contradictions (inlciuding self-inflicted), fabrications and out-and-out lies… The person TELLING people to use the search engine for verification between the two is the ONE with the TRUTH on their side…
No matter how you try and twist that, you can NEVER escape it, not when you are offline, not when you are online, not when you look at yourself in the mirror, it is ALWAYS there… YOU have to live with it… which is WHY I believe you continue to post on the SAME straw man over and over again… it’s really quite warped when you think about it…
For some wacky reason, you consider answering your questions and assertions excuses… If you don’t want an answer, don’t ask!
So, all your white noise on the schedule doesn’t even matter to me, becuase I am not delusional enough to think you actually care about this deal, you are just trying to save face while at the same time demonstrating your adolescent tendacies…
For clarity… I won’t be playing that game anymore… there is AMPLE postings for people to view on this, on both of our positions, and I am happy to leave the judgement on this up to the readers…
So, when you bring this straw man up YET AGAIN, as we KNOW you will, you can’t help yourself… I will simply quote it… and say STRAW MAN or RED HERRING, and maybe point out posts where it has already been addressed, and move on… I’ll do this, BECAUSE you will just bring it up in a thread where it has no relevance, and I will want to save people time…
Of coarse you will…that’s ALL you do. (well that and making excuses for your unfinshed project)
Here’s the bottom line…
I’ve helped INVESTORS here MAKE MONEY…NUMEROUS WAYS!! Whether it be through investing in STOCKS or REAL LIFE examples of companies I use as suppliers, techniques I use to add value to my flips, and countless other REAL WORLD examples I’ve laid out there that people have used to INCREASE their returns…
They know it, They appreciate it!!!
All you bring here is your polictical BULLSH*T and excuses. NOTHING ELSE…
“(well that and making excuses for your unfinshed project)”
Straw man… didn’t expect it THAT quick… :rolleyes
“They know it, They appreciate it!!!” & “Here’s the bottom line…”
Yes, the bottom line… I’m not asking you for it, so that should free you up to help everyone else with it… :beer
Keep up the attempts at diversion…It’s what you do BEST!!!
Fdjake,
“Keep up the attempts at diversion…It’s what you do BEST!!!”
Lol… Fdjake, if it is a “diversion”, it’s YOUR diversion… the quotes I answered were from YOU… :rolleyes :biglaugh :lol
And it’s what I do best???.. :bs me thinks a little more projection on your part… :biglaugh :lol
All’s not lost though, at least you’ve graduated to another adjective… “excuses” to “diversion”… baby steps, right?! oh, brother… :banghead
Positive,
From what I see, it looks like you think you’ll have 37k in this house when you’re done. You also said taxes were $700/yr, but that was already factored into your numbers. I know you’re looking to rehab/resell, but you said rent was from $600-725/mo.
Let’s consider $660 for rent since that’s about mid-range:
$660/mo means $330 NOI
$37k @ 7% for 30 yrs = $246.16/mo
$330 - $246.16 = $83.84/mo cash flow
Not bad, but for that rent, I’d rather be in at about $30K or so.
Your worst case price for the sale is $55k.
6% of 55k for Realtors’ commission is $3300
Figure another 1.5% ($825) for closing costs
That leaves $50875 for you. Minus your 37k equals $13,875.
Ok so almost $14k. How much work did it take you to make that money? I’d also consider this:
$660 times 12 is $7920. That’s how much rent you could’ve had if the project was completed quicker. What just happened to your profit when you consider that point?
Yes you own this place outright and have no payments, but there’s still an opportunity cost to that money. Your strategy of flip/flip/rental is different than mine. That’s not saying that either of us is right or wrong, but I go back to Bluemoon’s point about leverage. I want to own our properties free and clear in about 10 years to supplement my retirement, but I’d rather acquire properties faster using leverage than slowly buy here and there with cash. The majority of our places are on 10 yr amort. so they’ll be paid off with the rent by then anyway. If we bought with cash and didn’t pull it back out, we probably would have only bought 2 houses in the time we’ve bought 9.
You’ve got your reasons for taking your time. I just know we can’t have non-performing assets lying around. That would force us to start supporting our business financially rather than it standing on its own. I don’t mind loaning money to the business if we need it for a down payment on another house, but I don’t want to be paying the mortgage payments because we have too many vacant properties needing rehab.
And since we keep talking about him, I wanted to post a link to his picture:
http://www.flickr.com/photos/destinatio/64925425/
justin0419,
Thanks for the reply…
A couple of things…
RESALE
ON the resale, I had said NET $55K sans selling costs (meaning $55K after the selling costs) if things tanked for a new house… Help-U-Sell (our realtor - the owner) has a standard rate of 4.5%, but we currently have a rate of 4% for the first house and 3.5% for the next 2 and then 3% thereafter…
Closing costs, we’ll assume $900.
So IF things tanked and we shorted it and sold this new house for $58,500. that would leave us with a lttle more than $55K NET. $18,000 return minus the $37K, or just about a 50% ROI, 25% ROI over TWO years… a return I am happy with for a first flip… Add to that, because this is a side-investment, once we pass the one-year mark, the taxes will only be 15% as opposed to a minimum of 28% tax bracket (putting another $2,340 in our pocket)
Now, REALISTICALLY, the two COMPS on the actual street were $75K & $95K for AS-IS condition, so that $58,500 would represent a drop of 22% for the $75K and a 38% drop for the $95K, both VERY unrealistic for a New house. So the $58,500 number was just to make a point…
WITHOUT 10% down, $58.500 would be $450/month for mortgage (6%), RE Taxes ($60/month) and insurance ($40/month) for a new house… over $200 BELOW market rents or just about 32% BELOW the $660 rent mark you are using… Our realtor tells us that the number for an attractive resale is 90-95% of market rents, so even if we REDUCED that to 85% of market rents, that would put a target price of $77,000 for a new house at 85%, and … which would you rather spend… $660/mo for rent or $561/mo ($77K @ 6% + RE Tax and Ins) for a mortgage for a New house you own?
RENT / L.O.
With regards to the rental scenario, there is currently no mortgage on the property, and if I cashed out the $37K and paid off expenses, and never made another property investment, the remaning money would not be sitting idle, and even if I only got a 3% CD (which I would never do, as I don’t see the advantage of cashing out at 7% to get 3%), that would be an additional $30.00 per month plus the cash flow of $83.84/month totalling $113.34/month or $1360.08 annual cash from this one property… however, we would reinvest the money after covering expenses…
Lease Option is also a back-up if we end up having buyer-issues…
Our strategy of Flip / Flip / Buy Rental Cash is primarily for SAFETY… with the economy being so unreassuring, leveraging as a strategy may be something for the future… This is a side investment for us, along with our other investments, and we are interested in playing it safe at this point… as we gain more experience, we will look at leveraging…
“And since we keep talking about him, I wanted to post a link to his picture:”
LOL… let’s not forget his buddy… :biggrin
http://musingsandmutterings.com/wp-content/uploads/2007/02/red_herring2.gif
SOUNDS GREAT!!!
Now all you have to do is F I N I S H I T :rolleyes :rolleyes :rolleyes
Fdjajke,
“Now all you have to do is F I N I S H I T”
Straw man… :rolleyes :rolleyes :rolleyes
Straw man???
You’re sitting on an UNFINISHED PROPERTY and you’ve been COUNTING your profits for the last YEAR!!!
Nice try…Termite KING!!
Fdjke…
“You’re sitting on an UNFINISHED PROPERTY and you’ve been COUNTING your profits for the last YEAR!!!”
Straw man…
“Nice try…Termite KING!!”
You once again demonstrate your adolescent tendacies… you might as well have said… nanny-nanny poo-poo… :rolleyes :biglaugh :lol
Since we’re straightening out PosOtlook today, Pos, I don’t swoop in and steal people’s equity! Although I wouldn’t mind doing so, I think it’s called “profit”.
And if you’ve read any of my other posts, I fix up and furnish and rent out fully-furnished rental homes. So I am not a flipper. I hang on to real estate long-term unless it’s not a money-maker.
And I was surprised at how much time I have spent here online. I sure write faster than I used to.
Furnishedowner
Furnishedowner,
“Since we’re straightening out PosOtlook today, Pos, I don’t swoop in and steal people’s equity! Although I wouldn’t mind doing so, I think it’s called “profit”.”
EXACTLY… I was making a point and said so in the post… You demonize others for making a profit “from the premiums paid by poor folk”, thereby saying they are taking advantage of people in a desparate situation…
So how are you any different when you take advantage of desperate people who don’t know any better when buying their property at an extreme discount? Better yet, to the tune of 10’s of thousands of dollars, which could help not only PAY for not only their premiums, but other care or help give them a leg up? The insurance company PROVIDES a service for what they charge… they just don’t take the money… you only TAKE the property AND equity at a discount BECAUSE they don’t know any better and are desparate, otherwise it’s not a deal, right?.. You are BUYING their property AND equity…
“Why should “desparate” people have their equity STOLEN by people like you (making a point), because they don’t know any better, just so you can charge OTHER people $1500-$2000/month to stay in them??? They paid down their mortgage INCREASING equity (current down cycle notwithstanding), and YOU swoop in an TAKE the equity THEY created, the property and future income because of their circumstance…”
If you own the property you ALSO own the equity…
Thanks for “straightening me out”… :rolleyes
They say if you can keep a BULLSH*TTER talking long enough you’ll find the TRUTH…
I think we found it…
I’ve been rehabbing homes for over 20 years now and the NUMBERS never BULLSH*T…Let’s review a quick list of repairs POSITIVE has made (or still needs to make) to this little jewel of his!!
You guy’s can decide if YOU could bring this property in for the NUMBERS he’s throwing around here…
REMEMBER…He has said this will be a NEW HOUSE when he’s FINISHED.
He paid $8000 for the place.
The wood FOUNDATION was rotted and “gerry rigged” and needed to be replaced/repaired. He mentions that the home had a 4 inch slope over a 20+ foot span in one area in addition to termite damage he missed that was under the front bedroom and adjoining bathroom. This damage extended into the rim and floor joists. So this wasn’t some MINOR foundation repair…A 4 inch DROP over 20 feet is a hell of a slope. But that’s not the best part…
Here’s where it all goes to sh*t…
Let’s lay out what this place needs ACCORDING TO POSITIVE…Then let’s decide if all this work can be completed for no more than $29,000??? Remember POSITIVE has told us that his total investment in this property will be $37,000…Take out the $8000 he paid for it and that leaves $29,000!!!
I’m NOT including HOLDING COSTS in that $29K …I KNOW his holding costs bring that number DOWN BELOW $29K (ESPECIALLY when your total holding time will be well OVER ONE YEAR!!!) But for sh*ts and giggles ask yourself if YOU could do the following on a 3 bed 2 bath house this size for UNDER $29,000??? (he’s always CRYING about it being over 900 sq ft)
Remember…He said he couldn’t have his kids onsite because this project was a COMPLETE GUT. (those EXCUSES can really bite you in the @ss here)
Here’s what you need to do for WELL UNDER $29K!!!
EXTENSIVE Foundation repair including piers
Replace Floor joists
Replace Sub flooring
Replace rim joists
NEW Siding
NEW Roof
NEW Kitchen Cabs and Counters (interesting note here…In his original post on this home he said $3500 if HE built the cabs himself $6000 if he bought them, that’s a nice CHUNK out of that $29K HUH???)
NEW Bathrooms (2 in this property!!)
Apparently he had NEW PLUMBING INSTALLED TOO!! (he told us with all that new PEX he won’t worry about the pipes Freezing this winter)
New Electric (MUST be updated to current code in a rehab this extensive, especially a GUT JOB)
NEW Interior flooring (carpets, vinyl & laminate)
15 NEW WINDOWS!!!
NEW Front and Rear Exterior doors
Don’t forget to add in all the LITTLE THINGS that add up to THOUSAND$$$$ in any rehab ( I can hear the experienced rehabbers ALREADY LAUGHING)
New Interior trim
This was a COMPLETE GUT so NEW drywall throughout.
NEW Plumbing fixtures (Remember…This is a NEW HOUSE when it’s finished!!)
NEW light fixtures, switches and outlets (especially for code compliance and that NEW HOUSE LOOK)
Interior PAINT
I wonder if this $8000 DIAMOND had a BRAND NEW Heating system in it when the floors were caving in??? (my guess is NO)…That expense is never mentioned. (Do NEW HOUSES use OLD furnaces???)
All this DONE for LESS THAN $29,000!!! :bs :bs :bs :bs :bs
TOTAL BULLSH*TTER…ALL DAY LONG!!
This guy must think he’s dealing with STROKERS like himself here…
YOU’RE NOT!!!
I’m goin’ FISHING…I hear the HERRING are running…(Apparently along with the BULLSH^T)
Nice try…Sell it somewhere else.
See…We actually BUY & SELL Homes here…FOR REAL!!