Cash for Clunkers

[PositiveOutlook]

"You purchased this TURD in September of 2008.....That is a FACT.....
It STILL is NOT finished.....That is a FACT.....It is NOW AUGUST 2009....That is a FACT...."

It was the LAST WEEK of September, and you've been told this MULTIPLE TIMES and you STILL couldn't get it right, so you are either ignorant or just putting up more straw men...  And in FACT, I was the one who PROVIDED this information, but it was YOU who FABRICATED the misinformation on it, calling it "more than year" etc...

"YOU HAVE NOTHING.......Except A ONE YEAR OLD TURD!!!!"

Your opnion ONLY, and in this case, it is turning out to be not that important... But, I know better BECAUSE of the advice I received on this site and others... and when it IS done, I will post the pics (before and after) and the final numbers, including ROI... and we'll see how much of a "turd" it was.... 

".....If they don;t agree with YOUR view of the world it's 10,000 words of NEVER ENDING.....ON and ON and ON and ON and ON...."

The funny thing about this FDjake. is you act like you don't do the EXACT SAME THING...  Even when you keep posting on threads that you "skip" because they are SOOO boring... 

Can't wait to hear from ALL THOSE PM'ERS...   

[fdjake]

You won't hear from any of them....That's what you don't seem to understand...You've alienated a entire GROUP of readers here....and you STILL don't get it...

They've had it with you...

It doesn't help that you're delusional to boot....
You argue over DAYS and WEEKS on a project that as of the "last week in September" you've have OWNED for ONE FULL YEAR!!!!  BUDDY....NEXT WEEK is the LAST WEEK IN AUGUST....HELLO????  ANYONE HOME???? It's STILL NOT FINISHED, NOT SOLD, NOT RENTED, NOT EVEN ON THE MARKET...Yet with all this.....YOU CONTINUE TO ARGUE over what "I" say????   My points have been CLEARLY made....It KILLS you to have it STUFFED in your face....But FACTS are FACTS

This is EXACTLY what some people do that screw up their first flip.....They deny, deny, deny....The argue MINISCULE details like WHO missed what....Who was responsible?  The fact that you continue to WHINE about when you closed on this TURD is amazing to me....End of September, begining of August, 2nd week in October......DUDE...at almost ONE YEAR IN and NOT completed?????  IT doesn't matter at this point....This piece of chit won;t be done in September.....YOu know it and WE know it....Who do you think you're kidding with this closing date BS???   Besides....a closing date to a REAL investor is simply the green light!!!!   Everything is SET UP so the DAY you close....WORK STARTS.....NOt ONE YEAR LATER and STILL not complete....ESPECIALLY on an 800 sq ft cottage....MY GOD, this thing should have been a 4 week BLOW OUT and DONE!!!

Cripes....I wouldn't hire you to shingle a DOG HOUSE for me....You have the EXCUSE part of being a contractor down COLD...

MIND BOOGLING

[PositiveOutlook]

"You won't hear from any of them....That's what you don't seem to understand...You've alienated a entire GROUP of readers here....and you STILL don't get it..."

Yeah, THAT'S the reason we won't hear from them....   

"They've had it with you..."

More words from YOU, put into THEIR mouth... Unfortunately, as we have seen, FDjake, YOUR words don't hold much weight... and it's documented for EVERYONE, including the PM'ers YOU say exist to see...

"The fact that you continue to WHINE about when you closed on this TURD is amazing to me...."

The fact that it took you THIS LONG just to even GET IT RIGHT, is amazing...  more BS   

"Cripes....I wouldn't hire you to shingle a DOG HOUSE for me...."

If I CHOSE to even work for you, I would only work for you IF EVERYTHING down to the nail was in writing, and was paid IN ADVANCE... as we've seen, your word has very little value...  you can't get the little things right... how can we expect you to do it with the important things...

"Everything is SET UP so the DAY you close....WORK STARTS.....NOt ONE YEAR LATER and STILL not complete...."

It did... rip out started AFTER we got our permits from the city AFER we provided PROOF OF CERTIFIED INSPECTION...  nice try...

Keep talking genius...  it's getting more and more entertaining as we go along,...   

[phlemboy]

I have to admit, I have been reading along this sparring between FDJAKE and Poisitive. I can't really accurately comment on Positive's flip because I don't know the details from the beginning.

Was this a flip or rhab & rent?

What have the purchase, repair & holding costs been so far?

What's the expected profit/ rental income?

I may regret getting into this conversation, but I don't have a lot to do right now..

[PositiveOutlook]

PHlemboy...

No problem... all you have to do is look at the thread FDjake posted as his "Proof" that I "outright lied", which in actuality just BACKS-UP what I SAID....  obviously quite embarassing to FDjake...  Funny thing is, he tried the PM'er thing in THAT thread too (just check #68 and then I challenged him on it in #69)...   

BTW, for you and everyone else... the thread is titled...  "Re: GM is selling Hummer to mystery buyer"


Anyway, here is a copy and paste from that thread on the details...

"House purchase and repairs - $37K (including my labor) - no mortgage

COMPS - $80-$85 on the same street, and our house will be brand new...  I am doing the work myself as an investment...

2 bed/ 1 bath - both bedrooms now have double-closets, one is 10 x 13 1/2, the master is 12 1/2 x 14
Living room  11 1/2 x 14 1/2
Dining room  10 1/2 x 14 1/2
Kitchen  10 x 10 1/2
Front and back porch  (front porch - 9' x 22', back porch - 8' x 10')
1/2 acre lot...

Market Rents - $600-$725

1 1/2 - 2 miles from a major universtity, and around the corner from a park... and three blocks from local commerce

House is not sold yet (not finished), but when it does, I'll be sure to post the check... which will be five figures...

Who knows, based on this economy, I may have to make it a rental, although that's not what I want to do considering the work put into it... I would rather a couple use it as a starter home... maybe even do a lease-option..."

I added the porch dimensions above...


Our original plan was to purchase it as a Fix-n-Flip... what we planned on doing originally, was FLIP / FLIP / then Purchase the Rental Cash... and then continue along those lines paying cash as we go...  We are not full-time investors at this point...

Any other info you'd like... please feel free to ask.. that goes for anybody...

[fdjake]

So Phelmboy....

Ask yourself a few questions here????

WHY would an INVESTOR leave TEN'S OF THOUSANDS OF DOLLARS in "potential" profits sitting idle for over ONE YEAR in a DECLINING real estate market??? (and it IS over one year because this project is STILL incomplete at the 11 month mark and thus UNSOLD)

WHY would they risk VANDALISM, FIRE, A BROKEN WATER PIPE, THEFT, CONTINUED MARKET DECLINE, TIGHTER LENDING STANDARDS?? When they were sitting on the returns Positive claims he has here.....

UNLESS?????

Go back and read Positives post # 548 submitted on September 14, 2008 and get the REAL STORY!!!!

Because on that date.......ONE YEAR AGO......The ARV on this project was $65,000 to $75,000

Remember this is SEPTEMBER 2008..... BEFORE the GLOBAL financial MELTDOWN and unemployment went through the roof. 

Now it's worth $80,000 to $85,000!!!!!!

A $20,000 INCREASE!!!!!!

Apparently this property has INCREASED in value at over 30% during the last YEAR!!!!  At the EXACT time when the U.S. has recorded the largest drops in HOME VALUES ON RECORD AND THE ECONOMY GROUND TO A HALT!!!

Oh, and don't forget to ADD IN the expense for rebuilding the FOUNDATION, FLOOR JOISTS, RIM JOISTS, the MISSED termite infestation, and the ONE YEAR HOLDING COSTS on this little GEM....Those numbers weren't in the initial projections!  Last I checked HOME BUYERS weren't paying EXTRA for level floors or a sound foundation....Those items are EXPECTED.  If they aren't present????  Neither is your BUYER!!!  But he's not even CLOSE to crossing that minefield yet!

This is EXACTLY what I'm pointing out here.....This is a STROKER, a BULLSH*TTER......Someone that when faced with FACTS, simply reworks his numbers.   This is EXACTLY the type of person we ALL need to be careful of.....They are out there....They claim to be something they are NOT.....This guy claims to have a solution for the HEATH CARE CRISIS TOO!

When you've been doing this for over 20 years, spotting these jokers isn't hard. They SAY one thing but their ACTIONS tell a completely different story.  Remember that......It could save you a PILE of money some day.....Can you even IMAGINE having gone in with him as a PARTNER on this project????  I've seen people do it...The results are not pretty. 

This is a TEXT BOOK example of how NOT to rehab/flip a home.  You can check off the screw ups...

Blown Budget
Missed Deadlines
Missed Projections (the BEST one is the new ARV....wait till that REALITY sets in)
Missed Defects in Home
NOT ready for lisiting
Still NOT  FINISHED after 11 months
NOT SOLD after one year of holding in a DECLINING MARKET

 

I'll give the Bullsh*tter the last word......I'm done......the point here is simple....

We're REAL ESTATE INVESTORS here......

If you want to BS people about your property investments......JUST DON'T DO IT on REI forum.......IT STANDS OUT and makes you look like a JOKE.
I'm sure on a political forum they'd buy this BS hook, line, and sinker.

NOT HERE PAL.......Not for a second.
 
I'm done.....Sorry guy's for the arguement.....My apologies to the moderators.

Hope everyone has a profitable week!!!

[sellnbama]

So as of this morning "cash for clunkers"has paid 2% of dealers.I've heard of a number of local dealers that are'nt getting paid either.When will these einsteins figure out they have know idea how to deal with the private sector since they have never ran anything?Now we may have dealers going bankrupt,good job once again at screwing things up.

[fdjake]

There's a bunch of local dealers near me who REFUSE to implode the engines on those clunkers until they get their CASH...In addition, they have written in clauses on contracts that hold the previous owner responsible for any short fall if the Goverment doesn't pony up. (god only knows how that would work)

My best guess is they ALL get their money eventually.

But....your point is valid....Not a confidence inspiring start.

[phlemboy]

Positive. What was your goal when you bought this property? What was your timeframe? How much are into this project so far? If your goal was to flip, the ARV has to be less today than when you bought it. Unless of course your local RE market was immune to the decline. That reduced ARV minus your total cost to date might not be that much. Turning into a rental may work out in time but are you ready for that kind of headache? If you put a lot of high end items, it may take a while until the market improves to make a profit. IMO, if I had only weekends to work on rehab, I'd rather buy/rehab/rent. That way you just need to make it safe and clean. No need for high end stuff. Just working on my own house, I was able to completely gut and remodel my 5' X 7' bathroom and replace the kitchen cabinets, countertop, sink, stove & fridge. No high end stuff. Just mid-range quality from Home Depot. I don't think I spent more than $5K for everything. I did the work myself and had some advice & help from friends. If I were rehabbing a rental, the rents and type of renter would dictate what I would want to spend. Good luck.

[PositiveOutlook]

FDjake,,

"Because on that date.......ONE YEAR AGO......The ARV on this project was $65,000 to $75,000 "

Yes, that is what it was before we started on the project and the level of work we were originally goint to do on it...  This number was from our real estate agent...  The COMPS he provided (which I still have and can upload if we can do that here), show from $45K to a high of $95K, but that the two houses on the same street that sold were $75K & $95K (this was sold a few months pior to our purchase)...  The Comps SOLD AVERAGE was just over $65K, which is why he initially gave us the above numbers, because we were going to do lot less to fix it up (based on the city inspection repair list, which they then REQUIRED a certified inspection before we could get our permits) and just flip it... 

Local code is that when you open floors and walls, it has to brought up to code...  To make a long story short, this became necessary... 

End result, the house will basically be brand new when we are done, hence the modified assessment from our realtor thinking we can list it in the higher range... but as you can see, the two houses in the CMA ON THE SAME STREET sold for $75K & $95K, and the $80-$85 would be the mid-range AVERAGE SOLD of these two houses and they were not new houses...  When it goes on sale, I will update what we actually listed it for, and when it sells, what we sold it for, and to whom...


"...$65,000 to $75,000...."  &  "A $20,000 INCREASE!!!!!! "

No, FDjake, if it was a $20,000 increase, as YOU say, the new numbers would've been $85,000 t0 $95,000...   

"Apparently this property has INCREASED in value at over 30% during the last YEAR!!!!  At the EXACT time when the U.S. has recorded the largest drops in HOME VALUES ON RECORD AND THE ECONOMY GROUND TO A HALT!!!"

Once again, wrong Fdjake... NOT 30%

$65K to $80K would be a 23% increase
$75K to $85K would be a 13% increase

Being that it would be a new house, top to bottom, front to back, not unrealistic...   FYI, our local RE market was not hit very hard by this bubble (which makes me a little nervous)...  To give you an example, our actual home was just appraised again a few months ago, and it appraised for $3K MORE than it did back in October 2007 (which we bought for $5K LESS than the last appraisal in 2005)...  And yes, before FDjake wastes more time... I HAVE the appraisals...

Funny thing is, FDjake you've been doing this much longer, and your math is THAT BAD???  Aren't you suppose to be some kind of expert??? How embarrasing!!!  Maybe that's the way numbers work in the "commercial" market...      

Either that, or you are PURPOSELY trying to OVEREXAGGERATE, as usual.... no two good choices, no matter how you look at it...   

[PositiveOutlook]

Phlemboy,

Thanks for the reply...

"Positive. What was your goal when you bought this property?"

Well, it is our first, and we originally planned to fix and flip...  as I've explained in other threads, that is still our primary objective, but we are looking at holding it and renting it out, or do a leaase option as the back-up...  But I'm having a hard time reconciling renting it because of the amount of work we are putting into it...  But our long-term goal is to Flip / Flip / pay cash to buy rental... and keep going along those lines...

"If your goal was to flip, the ARV has to be less today than when you bought it. Unless of course your local RE market was immune to the decline."

The list price is what our realtor is telling us... when we actually do list, I'll give an update...  One other factor that I just thought of that might be reflecting this, is that the property is located in a redevelopment zone...  I don't know how much this affects things, so like I said, when it actually lists, I'll give an update...

"What was your timeframe? How much are into this project so far?
  &  "That reduced ARV minus your total cost to date might not be that much."

We'll be in it for a total of around $37K...  Rents are in the $600 - $725 range (the house right next door, one of four rentals on the street, just raised their rent from $550 to $600 and it is rented, and rented right away - it is smaller house, with no dining room, no front and back porch, smaller bedrooms and another house the next street over just rented for $725 back in May I think it was after being remodeled)...  Our house will also have a washer/dryer area, and double closets in the bedroom... Realtor tells me these are hot-button items for resale (he is also an investor and owns a local Help-U-Sell)

This was our first, and we expected to make mistakes along the way... legitimate questions on the way we are doing with regards to the schedule, maybe... but, because we will own it a year  before selling, that will increase our ROI becuase of the lowers taxes, and who knows, maybe it will be a good think we waited...   people are flocking to our neck of the woods for a higher standard of living, so that's also in our favor... time will tell...

"Turning into a rental may work out in time but are you ready for that kind of headache?"

On the first property, No, not really... that is the plan down the road after the first two flips, but if for some reason we couldn't sell it, we'll start renting earlier than planned...  The numbers work for a rental, we just didn't plan to START with a rental...


"If you put a lot of high end items, it may take a while until the market improves to make a profit."

I know how to make improvements that don't cost alot, but have a good return and make the lady of the house happy...

"IMO, if I had only weekends to work on rehab, I'd rather buy/rehab/rent. That way you just need to make it safe and clean. No need for high end stuff."

I am definitely with you on this...

"Just working on my own house, I was able to completely gut and remodel my 5' X 7' bathroom and replace the kitchen cabinets, countertop, sink, stove & fridge. No high end stuff. Just mid-range quality from Home Depot. I don't think I spent more than $5K for everything. "

That's about right... the bath in this remodel is also 5 1/2' x 6', and the kitchen is 10' x 10 1/2'...

"I did the work myself and had some advice & help from friends. If I were rehabbing a rental, the rents and type of renter would dictate what I would want to spend. Good luck."

Mainly, I am working on this with my son this summer...  Whatever we don't finish this summer, will be finished in the fall...
 

Thanks for the input...   
 

[Bluemoon06]

Once again, wrong Fdjake... NOT 30%

$65K to $80K would be a 23% increase
$75K to $85K would be a 13% increase

That makes all the differnce in the world.