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Sounds good, but where are you going to get the money? A bank isn't going to lend it to you.
How much is the land worth alone?
I was just assuming that if I was able to get a home loan on an already-built house, that I would also be able to get a home loan on a house that I would build. I guess from your statement I can infer that I am incorrect in that assumption? Shows how much I know. Okay, so how can I determine the value of the land alone? I just tried googling the answer and got nowhere.
I was just assuming that if I was able to get a home loan on an already-built house, that I would also be able to get a home loan on a house that I would build. I guess from your statement I can infer that I am incorrect in that assumption? Shows how much I know. Okay, so how can I determine the value of the land alone? I just tried googling the answer and got nowhere.
Just because there's a house there doesn't mean you can get a loan to build a multi-family building. You have to get through zoning first! And banks aren't handing out buckets of cash to build apartment buildings unless you already have buckets of cash in your reserves.
Value of the land....look at the assessment. It will say what the land is estimated to be worth and what the improvements are worth. Now take that with a grain of salt. Some of them are VERY accurate and others....not so much. But it will give you a starting point. And it's free!
To build you will have to pay for permits and surveys. To tear down, you will have to pay for permits and surveys....not to mention dumpsters which will be THOUSANDS. Oh and if there is a drop of lead paint or asbestos, forget about it! You could go bankrupt tearing it down. There are laws you MUST comply with. If you don't and are caught, the fines are INSANE!
Why not spend some $$$ and fix it up? You may be able to add on to it.
FYI....low renters aren't going to pay a fortune for a new building. Low renters aren't exactly known for keeping property up either. Heck, plenty of people paying high rents don't give a care either. It's not theirs so they don't give two hoots. You sure you want to spent hundreds of thousands of dollars for 3 OTHER families to live in? Don't think you'll be making buckets of money overnight! It's soooo NOT happening. You have to be in real estate for years to make money generally....unless grandma owns a gold mine or 20 acres in prime ocean living....otherwise....it takes time. If you could get rich overnight, EVERYBODY would be doing it.
I don't want to get rich or anything. I just want to generate a little extra cash flow to help pay off the mortgage, and live in it too. I think the house is too old to salvage. It was built in 1950 and it looks like it wasn't the nicest house even when it was brand new. It's not awful. It's just not what we would prefer. So then I started thinking about how, I would live there if I could rent it out to others at the same time, like a duplex or something. But I know that if I build a structure for commercial purposes only, and don't live in it, it means I can't have a homeowners loan, and I have to treat it like a business. But that's not what I want. I just want to hold on to the property to keep it in the family.
It's starting to sound like I should raze the house and treat it like an empty lot. At least that way the upkeep would be easier. I just don't think I want to sell it. Not yet anyway.
I don't want to get rich or anything. I just want to generate a little extra cash flow to help pay off the mortgage, and live in it too. I think the house is too old to salvage. It was built in 1950 and it looks like it wasn't the nicest house even when it was brand new. It's not awful. It's just not what we would prefer. So then I started thinking about how, I would live there if I could rent it out to others at the same time, like a duplex or something. But I know that if I build a structure for commercial purposes only, and don't live in it, it means I can't have a homeowners loan, and I have to treat it like a business. But that's not what I want. I just want to hold on to the property to keep it in the family.
It's starting to sound like I should raze the house and treat it like an empty lot. At least that way the upkeep would be easier. I just don't think I want to sell it. Not yet anyway.
If you are renting to 3 families, you are in business! If you're renting to 1 family, you're in business. Being a landlord is a job. You will also have to claim ALL of that income and repairs on your taxes. You'll probably need an accountant for that and not the guy who took the 20 hour course at H&R Block. You will have to pay quarterly on your income since it won't be taxed like your paycheck. It's a whole ball of fun!
Don't think that it will be free to raze the house. First off, you need to get approval to do it. You will need permits and surveys. They can cost thousands. You'll need who knows how many dumpsters. That will be several thousand..... You will probably need testing done for lead and asbestos since the house was built before 1978 to get the permits. Those could get expense quickly. This also won't be a quick process. I've seen it take 10 years for someone to be able to raze a house. Others take a year. It all depends on the town and what's in the house and what's in your wallet.
You can search the address right here on City-data and find out what the actual size of the property is and some other interesting info that might inform your decision.
Do you have any thing saved that you can use to start this process? You'll have to talk to a builder and see: what kind of multifamily unit can be put there WITHOUT killing all those beautiful TREES. and: How much it will cost you. If you have good credit and some kind of down payment, I don't see why you couldn't get a loan. If the bank won't finance it, the builder might.
You can search the address right here on City-data and find out what the actual size of the property is and some other interesting info that might inform your decision.
Do you have any thing saved that you can use to start this process? You'll have to talk to a builder and see: what kind of multifamily unit can be put there WITHOUT killing all those beautiful TREES. and: How much it will cost you. If you have good credit and some kind of down payment, I don't see why you couldn't get a loan. If the bank won't finance it, the builder might.
This is helpful, thank you! Yes, I have a nice job, with plenty of money saved up, and could easily pay cash to have the demolition done, as long as it doesn't go over, say, $15000 or so. I will look into this. I also really like the idea of possibly being able to have the builder finance the home. I've also been reading up on these "one-time close" loans or whatever they are called. It seems like it's possible that what I'm envisioning is not entirely fantasy. I might need to settle for a duplex instead of a quad plex, but whatever. I also know someone who used to be our landlord, many years ago, but has since become our friend... and she has a business buying up old historic apartments and quad-plexes, fixing them up, and renting them out. She might be a good resource for me. I do have fantastic credit, and someone told me that since I've never bought a home before I might qualify for some kind of FHA loan or something, which I need to look up now.
I will now try to find out where on C-D is the place I can type in the address like you mentioned...
Yeah but OP isn't loaded with cash not a developer or LL. (My first assumption was that he was). If I was in that situation I would simply sell the property. Since its mixed commercial/residential and commercial space is worth more long term IMO that's who I would target to sell. (I mean if you gotta keep it you can get someone to develop it and then market it etc but you gotta know what you're doing. And its a lot of money. I've ran commercial jobs. They are a lot of headaches) Go find a realtor that deals with commercial space not a residential realtor. Depending on how much I got I would go and buy a house to live in and invest the rest. If you want to be a LL go buy a investment rental.
At the least you can get a nice house to live in that's most likely gonna be paid off.
Quote:
Originally Posted by hush.bereel
Okay I found this link on the main page called Home Value Estimate, which I just calculated, and it said:
Low range value price: $54,314 High range value pice: $100,870 Estimate confidence: Very Good
That is one hell of a range right there. I'm also not sure if it's referencing the house or the property, or both?
Usually there is a land value and improvement value. Improvement meaning anything on the land outhouse or palace.
How are the remodel laws there? In Newport Beach Ca if you leave one standing framed wall from original structure it's considered a remodel. If you raze it and start over its new construction. A remodel loan is different than a new construction loan. Is 100k enough to buy a existing duplex or multi unit building?
Thanks, E4you, I really appreciate all the help you've been offering in here. You just reminded me that I did read something about the possibility of keeping one wall up, like you mentioned. I will check into that! I think I may very well just end up consulting with a commercial real estate agent. This is a bit more complicated than I thought.
That being said... can anyone recommend a good "Real Estate 101" book for me to go immediately purchase and start learning the ropes from?
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You just reminded me that I did read something about the possibility of keeping one wall up, like you mentioned. I will check into that! I think I may very well just end up consulting with a commercial real estate agent. This is a bit more complicated than I thought.
