Friday, January 22, 2016

How To Flip A Property: Identify Property

In case you missed the first two articles on How To Flip A Property.

OK, here we are so far.

WE...

  1. decided on budget
  2. determined type of property available with budget
  3. reached consensus on size, bedrooms, baths, etc.
  4. decided on a specific location
Now we need to identify a property.  This is the hard part, in my opinion, because we (Roberto and I) are looking for something with a dual purpose...being a profitable flip OR a profitable rental.  If you ask 10 agents, you'll probably get 3 good answers because most don't have real time experience dealing with their own flipping or rentals, but this is what we do.
  • Is the property already discounted or at market price? This is what I mean.  If, for example, I am looking at a property that is already priced $20,000 below comp. properties, that is the sort of discount we look for in this specific price range.  Typically bank owned, short sale type listings offer the best deals, but not always!! Keep your options open and consider everything instead of assuming it's bank owned or nothing.
  • This is for flipping.  What will it cost to get top dollar for this property?  What type of updates or upgrades are needed?  Consider your immediate market.  If you are doing a flip in an upscale area where it's generally expected that high value properties have wood floors, stainless appliances and granite, what does all of that cost?  Will these improvements increase the price to pay for itself + extra $$ for your efforts?  Are you going to have to hire most improvements?  This needs to be factored as well, because labor costs will consume your profits.  Each investor has different margins, some want to make $50,000 profit while others are content making $30,000 or even $10,000, so these numbers are investor specific.
  • This is for rental.  Again, we do a similar assessment regarding repairs/upgrades for rentals because properties in upscale communities can get better returns and quicker turn around (time to lease) with bling.  But, now you have to determine if the improvements will pay for themselves.  For example, if a 2/2 property with 1,300 sq. ft. with no upgrades leases for $1,250 per month, will it lease for $1,400 with some upgrades?  Lastly, what type of returns do you want?  Are you looking just to make the mortgage payment plus a little extra OR do you expect specific performance?  We won't purchase anything without getting a 10% Cap. Rate.
As you can see, there are many variables to consider when dabbling in rentals OR flips, but it's not super difficult if you recognize what you don't know and ask questions along the way.

Thursday, January 21, 2016

How To Flip A Property: Criteria

In case you missed the first part of the series How To Flip A Property.

Now it's time for us to identify the specific search criteria on MLS.  This screen shot shows our parameters and search criteria.  As you can see, we didn't specify a lot of things since this area is quite competitive with most properties exceeding $150,000 altogether.

We are not interested in 1 bedroom 1 bath properties since their overall appeal and upward pricing and rentability is much more limited and outside our scope of objectives.

1. Budget to $150,000
2. At least 2 bedrooms and bathrooms



3. Anything above 1,000 sq. ft. under air
4. The 32832 ZIP Code, which is in the Lake Nona area

Our budget does not get us into single family properties, but we are content to have a townhouse/condo/villa.



Wednesday, January 20, 2016

How To Flip A Property

If you're like me, "must see" TV is generally centered on one of the real estate "flipping" shows: Flip or Flop, Las Vegas Flip, Fixer Upper, etc., are some of my favorites.  None of them really show the process or offer viewers a logical place to begin if they have plans to enter the flipping business.

With that in mind, this blog series will follow our latest endeavor, which is to locate a flip/rental property in the Orlando area.

Our budget is $150,000.  

The objective is to identify a property in a solid/upcoming neighborhood that supports 
1. increased property pricing after improvements 
2. strong rental income...we want to have the option to hold or flip.

Now the fun part!  Looking for properties!


Friday, July 24, 2015

Privacy & Country Living Near DT Orlando and Lake Nona

If you are looking for acreage but don't want to be way out in the boonies, check out the southern part of Wedgefield southeast of DT Orlando.  It is fairly rural, but it's only 10 minutes east of OIA and Lake Nona off the Beachline #528 at Dallas Blvd.

You can find 1 to 10 acre parcels and build what you want OR pre-owned homes are always available.  The area is deed restricted with these being the more important rules:

  • Anything built on an acre must have at least 2,200 sq. ft. under air
  • No mobile homes, doublewides, modular homes are allowed
  • Optional HOA 
  • Horses are allowed but you must have two contiguous acres for the first horse

Additionally, the acreage lots to the south (estates area) are well and septic, only the homes in the northern part of Wedgefield have public utilities...they are on small subdivision lots.  This is also in the USDA Financing zone where 100% financing is available.

For new construction in Wedgefield or Lake Nona, I recommend SPC Homes.  They build a nice home, they 100% welcome the LGBT community, which I can confirm since I've had numerous transactions with them over the years.  





Friday, July 10, 2015

East Orlando 100% Financing Available!

100% USDA Financing!


$199,900! 

This nice 3/2/2 home is eligible for 100% financing on the east side of Orlando!  Super convenient to UCF, Waterford Lakes, Space Coast & Central Florida Research Park.


Wednesday, June 24, 2015

Builder Basic or Upgrade? New Construction Upgrading Tips

What sort of things should be upgraded in a new home?  I recommend focusing on ROI (return on investment) at resale and stay away from things that cost you a lot now while adding no value to the home later.
Don't Upgrade. I wouldn't upgrade carpeting, plumbing fixtures, ceiling fans, flooring, lighting or appliances.

Most times, you will find a much better price sourcing these things yourself while getting the style and brand you want.  My suggestion. Go with whatever the builder offers as standard and if you don't like them, make changes incrementally, but over time.

Things to upgrade. I recommend upgrading things that actually add value and cost a lot once the house is completed. Things like extra recessed lights, built-in smart home system, pre-wire and pre-plumb for outside kitchen, upgraded cabinets, more sq.  footage, extra bedroom or bathroom, covered patio, metal/wood banister instead of half wall, 3rd stall garage, cabana apartment, etc.

Lastly, if you decide to purchase a new construction home, make sure you have your Realtor with you.  Why? The builders sales reps. are there to represent the builders interests, not yours, and since 99% of builders pay the Realtor's commission, you are getting full service and representation without paying for it.

Tuesday, June 23, 2015

Zero Down Financing Available In Greater Orlando



Saving for downpayment? Nope.
Saving for closing costs? Nope.
Money to purchase appliances or paint? Nope.
...you can purchase a home with 100% financing!!  
Is this you?  Or, are you and your partner trying to get ahead but find it impossible to save to buy a house? Then consider USDA financing.  It is income based, so if you/partner have a household income (combined) of $75,600 your income qualifies for the program. 
Since USDA is the old Rural Financing Program, the areas eligible for 100% loans are outside DT and the immediate areas. 
The current map of eligibility for USDA is quite large and includes the following communities: Areas of Kissimmee, extreme East Orlando, areas of Apopka, the area just south of Lake Nona in St. Cloud, Winter Garden, Davenport, Ocoee, Groveland, Orange City, Wedgefield (acre + lots), Geneva, Poinciana, Celebration & Haines City.
Program requirements
  • No Down Payment Required
  • Seller paid closing costs OK up to 6% of purchase price
  • No Pre-payment penalty
  • Max. loan amount is $417,000
  • 620 Credit Score required
  • New and existing homes OK
  • 30-year fixed rate loan
   Maximum adjusted gross household income:
    1-4 Person: $75,650
    5-8 Person: $99,850
Loan approval is fast...ask how & begin looking at houses!