Step #1 – Buying RIGHT!
Posted by capitalhomeslp on Jun 22, 2011 in Blog, Brandon McDonald | 0 comments
So… Jason wants me to write about all the mistakes I’ve made in my real estate career for a blog. Embarrass myself publically forever and always on the internet, SURE!! Why not.
The first few of these entries are all equally important. If you do 2 of the 3 well, you’re still screwed… So do a great job learning all of the first 3!!
In the beginning was a deal, and the deal was not very good…
First mistake: I paid too much… for a house right from the start. The issue with paying too much for a house is starting out behind the eight ball. No matter how cheaply you get the work done, how discounted you find your tile, hardwoods, and a fancy new Ebay Vanity, you started out on the wrong foot.
Deal specs:
Purchase price $89,000
Rehab budget $10,000
Sold on the first day we had it listed for 125,000!!!
Everything worked out for the best, but I still paid about $15,000 too much for the house!! DON’T pay too much.
The reason I paid too much.
There’s a formula that real estate investors try to live by called “MAO” Maximum Allowable Offer
It’s a simple math equation (if it wasn’t I wouldn’t be able to do it, so don’t freak out)
After repaired value ($125,000) x .7 = $87,500
$87,500.00 is not what you want to pay for the house, however.
The next step is subtracting your estimated repair budget. In this case it was $10,000.00.
The most I should have paid for this home was $77,500.00
If I had lived by this number I would have offered less and would have retired already. Ok, maybe not, but I’d be closer to it!!
That’s how we calculate offers today. It gets more difficult when you get into the homes that are higher priced to use this formula. The profit margins get so HUGE that people are willing to take a bit less for them and you are always getting outbid.
For us little fish it’s very dangerous to overpay. One or two price drops, holding costs, Realtor fees, and closing costs can completely wipe out everything you’ve done. That’s what I will cover next. How to come up with the After Repaired Value!
1200 Chester Ave Unit B
Posted by capitalhomeslp on Jun 21, 2011 in Currently Rented | 0 comments
This is part of a triplex located in East Nashville.
Here are some details
- 2 Bedroom
- 1 Bath
- New Ikea Kitchen
- Fully Remodeled Bath
- Vaulted Ceilings
- Freshly Painted
- Newer Appliances
- Hard surface floors throughout
- Private Laundry Room w/hookups
- Window air
- Wall heat
- Huge Front Porch
This rental has been fully updated with new insulation to provide a high level of comfort with a low utility bill.
Live close to the Trendy parts of East Nashville
5 Pionts – http://www.yelp.com/biz/5-points-nashville-2
Riverside Village - http://www.riversidevillagenashville.com/
http://www.familywash.com/
http://www.facebook.com/PiedPiperEatery
I could go on and on….
Rent $675
Deposit $675
Surrounding yourself with greatness!
Posted by capitalhomeslp on Jun 8, 2011 in Blog | 0 comments
2222 Real Estate Investing blog. Talking about how we buy houses, how we sell houses, negotiating, renting homes, and anything that has to do with the business of real estate investing in Nashville TN dSdfsdf
100 Sunshine Ct Antioch TN
Posted by capitalhomeslp on May 26, 2011 in Sold | 0 comments
This house sits on a dead end street in the middle of a very nice community. With access to a community pool.
3 bedroom / 2.5 bathroom
2 Car Garage
1750 Square Feet
You will feel right at home with this fully renovated house just outside of Nashville TN. When you walk in the front door you will see custom touches that you will not see on any other houses in this price range or area.
Just a few:
Custom tile inlay
Brand new hardwood floors
Open foyer
Furniture style bathroom vanities
Stainless steel appliances
Granite counter tops in kitchen
Granite counter tops in both upstairs bathrooms
If you would like more information or would like to schedule a showing appointment please feel free to contact us.
3320 Towne Ridge
Posted by capitalhomeslp on May 9, 2011 in Sold | 0 comments
Huge renovated house in Antioch TN.