New Guy Answers all

[Thirdcoastinvestments.net]

Hi my name is Jeph Burnett I am a full time investor in Houston TX.
I also work as a consultant to a G.C. for a company that I am also the C.E.O of. (I don't swing hammers)
After 10yrs in business working on investor properties in Houston, Dallas, Austin, San Antonio, New Orleans, Gulfport, I have found a couple of tricks.

So w/out anymore pumping up my already big head, If you have ANY questions about ANYTHING to do w/ ANY Construction project ask me here.

Commercial
Residential
Multi-family
Zoning
Codes
Definitions
shortcuts
Picture analysis (post a pic of your problem and watch me fix it)
Quote analysis (tell me what that guy said it would cost, I'll set you straight)
How much do I need for.....
Were do I find.......
Do I really need to....

You get the idea.

Here is some info just to get the ball rolling......


General speaking a rehab is a home that is in severe disrepair.
i.e.
Broken windows, Damaged/leaky roof, moldy drywall, cracked slab, falling down siding, etc.

A remodel is when cosmetic work is the reason for spending your profit.
i.e.
Replacing laminate counter tops, updating tub surrounds, installing new cabinets, new jewelry throughout. (don't forget everyone likes new jewelry in a home)

Make ready is the most minor of repairs.
i.e.
Touch up/ full paint, Carpet replaced (don't forget tile is always best in high traffic/wet area's),new light bulbs, change door locks, etc.


I am waiting.
Jeph

p.s. Jewelry is new bling bling fixtures (plumbing and electrical)

[Dan Auito]

Thanks Jeph, glad you took up the mantel here. Experts like yourself are one of the keys to success in the trade and also in this family's forum here in the form of sharing, caring and providing insight, time and talent. You embody our creed of offering to help others and I personally want to thank you for offering your valuable time and talents! :praise:

Folks, you know whom to ask, Jaxgirl, you had some Historic rehab questions I believe? yes?

P.S. Jeph, Jacksonville Girl had a question about rehabbing Historical homes in this thread, you could certainly be of service here: http://www.magicbullets.com/forum/showthread.php?t=6197

[Randy (SELA)]

How's the cash flow over there in Houston?

[Thirdcoastinvestments.net]

For me great, but that is because I know I make my money when I buy.
It is a little difficult to find deals through the traditional way's (bandit signs, newspaper ads, etc) But if your creative and patient deals always come your way.

I sell package deals to investors cash flowing more than deals they can find, rehab, rent, themselves. I want all deals to cash flow as much as possible because most hire me to manage the properties after they are rented and the bigger the rent amount the bigger my cut.

I imagine it is this way in most places, but Houston is especially filled with novice "investors"

Jeph
"Luck is a lazy mans excuse" <--I heard it this way.

p.s.
How do you calculate "cash flow"?
I think that if you put 20k into the project to make it cash flow 100 bucks a month then you got hosed. Is this your opinion?

[Debbie]

p.s.
How do you calculate "cash flow"?
I think that if you put 20k into the project to make it cash flow 100 bucks a month then you got hosed. Is this your opinion?

If hubby and I rehabbed into the project for just to get $100/month net cashflow, I will personally grab the garden hose and aim it at us!

Let me put it this way, as far as my city is concerned, there is no reason to get cashflow for less than $200+/month net. Granted, special circumstances are excepted but in general......

[Randy (SELA)]

Yes I'm still an amateur, but it all depends on location. The days of getting $200/month cash flow in my area are slim and none since the hurricane. Of course, I'm talking about SFH's, not multifamily. How do you find most of your properties?

[Thirdcoastinvestments.net]

ARE YOU KIDDING ME????
I would love to spend all my time in the ravaged area any hurricane.
People leave and quick, cheap.
I have purchased 100+ homes since Katrina in the S. MS area.
I didn't have to beg, plead, cheat, steal, lie, I just said here is what my offer is 1000 times.
3 percent of A.R.V. cash flow (montly, net net net) or I don't want to mess w/ it.

(for more info on this topic please refer to Kenny Rogers, Gambler)
If you know, then it's not a gamble.

[ThreeRiversREI]

3 percent of A.R.V. cash flow (montly, net net net) or I don't want to mess w/ it.

Presumably cash offers to boot so you can close in days and the hurricane victim can be on their way immediately?

How soon after a disaster like that do you start making offers? I would think too soon and people would still be dealing with insurance settlements and/or you'd come across as a carpet bagger/vulture.

[Thirdcoastinvestments.net]

Cash is fast. (don't believe the visa check card commercial)

Well sensitivity is WAY more important than waiting for an insurance check.
If someone wants to move I will sit and wait for there check. :thumbsup:
I use estimating software (xactamate) that the claims adjusters use to make sure I know what the check will be before they do.
(For more on this refer to Steve Miller Bands: Take the money and run)
Jeph

[Randy (SELA)]

I'm not following you. How much is 3 percent of A.R.V. cash flow? If you are flipping these properties, to whom, if everyone is leaving? If holding, what about the insurance rates now, and what will you do if another hurricane hits?

[Thirdcoastinvestments.net]

I Just bought a Home on 21st Ave. in Gulfport MS for 37,500 rehab it for 34k and have it listed for 192k.
Flip
Flip
Flip
Everyone is looking for a home or office in S. MS so why not buy from the ones leaving and sell to the ones staying (once they have somewhere to stay)

[msibuyhouses]

If you have ANY questions about ANYTHING to do w/ ANY Construction project ask me here.

Okay, I'll bite. I've been ripped off so many times before.

What should I pay to box in some duct work? HVAC contractor just completed some corrective repairs and added central air conditioning to a two unit multifamily in Baltimore City. He put in the duct work, but didn't box it in. As new and shiny as it may be, I've got to cover it up. How much should I pay for framing, sheet rock, painting, and the molding?

Sorry I don't have any pictures (I'm sitting in airport browsing my favorite site).

The building was built in 1920. The ceilings are higher than normal. The molding around the wall is about 5-6" in height.

I'll try to better describe if you need further info.

[Aldo]

It would be helpful to know where in the room(s) the ductwork was installed. If the ductwork is at the ceiling and you have nine or ten feet high ceilings, for example, the simple solution would be installing a suspended ceiling for, maybe, about $150. Enclosing vertical ductwork in a corner would be cheaper than enclosing it a distance away from a corner. There are other ideas out there, but more detail would help us offer more specific suggestions

[brianb_cobbres]

Okay, I'll bite. I've been ripped off so many times before.

What should I pay to box in some duct work? HVAC contractor just completed some corrective repairs and added central air conditioning to a two unit multifamily in Baltimore City. He put in the duct work, but didn't box it in. As new and shiny as it may be, I've got to cover it up. How much should I pay for framing, sheet rock, painting, and the molding?

Sorry I don't have any pictures (I'm sitting in airport browsing my favorite site).

The building was built in 1920. The ceilings are higher than normal. The molding around the wall is about 5-6" in height.

I'll try to better describe if you need further info.


Is this running across the ceiling or from floor to ceiling? And yes, pictures would help. One room or multiple rooms, because size really does matter? Are you just hiring a GC or using a handyman by the hour? Did you know the HVAC guy was going to leave exposed ducts?

[msibuyhouses]

Nope, did not know the HVAC guy was going to leave exposed duct. I guess part of the corrective work was to put in some sort of intake vent. The duct work runs straight up and down in the hall way. It is not in a corner. I do not plan to box in the basement stuff. I would guess the distance from floor to ceiling is between 10 and 12 feet.

I previously had someone box in exposed duct work that was already in place when I bought it. That work was part of the renovations. I learned about the missing air intake problem later -- third contractor admitted that he didn't know much about heating systems, however, he knew enough to know that air was suppose to go into the unit -- that's the reason why it kept shutting off. The two previous contractors charged us to "fix it."

To sum it up, the duct work that needs to be boxed in goes straight up and down. There are two of them for air return.

[brianb_cobbres]

Nope, did not know the HVAC guy was going to leave exposed duct. I guess part of the corrective work was to put in some sort of intake vent. The duct work runs straight up and down in the hall way. It is not in a corner. I do not plan to box in the basement stuff. I would guess the distance from floor to ceiling is between 10 and 12 feet.

I previously had someone box in exposed duct work that was already in place when I bought it. That work was part of the renovations. I learned about the missing air intake problem later -- third contractor admitted that he didn't know much about heating systems, however, he knew enough to know that air was suppose to go into the unit -- that's the reason why it kept shutting off. The two previous contractors charged us to "fix it."

To sum it up, the duct work that needs to be boxed in goes straight up and down. There are two of them for air return.


That is a fairly simple project. A few studs, a sheet of drywall and some other misc. supplies. I cannot imagine the whole things costing more than a few hundred bucks. You may be better off looking for a handyman that will do it on an hourly basis. The only tough thing will be if you have a complicated molding that they have to recreate.

[Thirdcoastinvestments.net]

Sorry it took me so long to reply.

The best way to handle small projects like this is to go to your local hardware store and pick up a couple of "handy man, I do drywall" cards and ask them how many hrs they think it would take to fix this eyesore.(10-15 at most) Then offer to pay them a ridiculous amount of money per hr. Like 25-35 bucks + Materials (less than 200) Settle on a length of time, per hr rate, and what your final expectations are. (what you want it to look like).
Pay'em when they are done. (450-725 I guess would be the short answer)

Does this answer your question?

[msibuyhouses]

Pay'em when they are done. (450-725 I guess would be the short answer)

Does this answer your question?

Yes, that does answer my question. I was hoping for something closer to $350.00 for everything, but I do want to be fair.

Thanks much!

[Thirdcoastinvestments.net]

You could always stand behind them w/ a size 12 and see if that speeds them along.

[Randy (SELA)]

Good one :xxrotflma