How to Develop Duplexes with Zero Cash - Build to Rent Real Estate Training
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- Опубліковано 20 вер 2024
- Discover a way to develop ground up rental real estate with no cash tied up AND without long-term partners or equity investors! Nobody teaches this because the few that understand how to do this are not sharing their secrets. If you're interested in developing small scale, attractive rental properties for lifetime cashflow, then this hour-long training session is for you! Couple of links from the video:
Land Due Diligence Checklist: RehabValuator....
Free Land Video: • How to Get Free Land! ...
7 Ways to Find Cheap Deals: • 7 Ways to Find Cheap L...
**The Software Used In This Video is called Rehab Valuator. It does everything from deal analysis to lender presentations to full project management and tracking!
Get 2 Week Test Drive Here: RehabValuator....
In this video I cover:
- Why duplexes are more efficient to build than single family rentals
- Why you should focus on Class A product if you want your life to be easy
- A unique strategy to get FREE LAND on which you can develop your rentals
- The difference between OPP and this method (they're very different)
- 3 Steps in this $0 Cash Strategy - broken out
- And much more
Make sure you leave me your comments and questions below.
Free Land Due Diligence Checklist: RehabValuator.com/list
Free Land Video: ua-cam.com/video/rj5Ym-MWZZU/v-deo.html
7 Ways to Find Cheap Deals: ua-cam.com/video/HU-a26ICSuA/v-deo.html
**The Software Used In This Video is called Rehab Valuator. It does everything from deal analysis to lender presentations to full project management and tracking!
Get 2 Week Test Drive Here: RehabValuator.com/try
Can you be available for a quick consultation?
Watching your videos gives me reassurance that I can make this happen. It's easy to get scared of taking all these steps, but the way you lay it all out reminds me that at the end of the day, it's not that complex.
Glad to hear it. It's not complex. Like they say "It's simple but not easy". Just requires patience and hard work.
I am in same boat. It’s the first steps that makes one cringe. Needs a mentor who knows what they doing. Good work.
I want to come back here in a year from today and tell you I finished building my duplex. I did the same thing one of the videos where I promised to buy a house and I did so shall I build a duplex by Aug 2025. Thank you for this, I have been following you and almost watched all you videos and this is better than my NYU masters program
Better than NYU Masters - I'll need to frame up this one :) Appreciate the awesome feedback. See you in a year when you finish your duplex!
Hey Dan! I just came across your channel. I have a very similar story to yours. I came to the US from Belarus when I was 12. Got into real estate in 2011. Grew my portfolio to 185 units in upstate New York and left my corporate job in 2020. I also post videos sharing things that I've learned along the way. Let's connect!
Awesome! Nice channel you got. What's your email? I'll reach out - maybe we can collaborate in some way. Thanks!
I’m glad you did this video based on CURRENT Market rates/ today
I am glad that you're glad! :)
I have been following you for a while, Dan. You are awesome!! Thanks for all the free tips and for not nickeling and diming people like a lot of investor-coaches do!
You're welcome and thanks for the kind words! We try :)
Love your extra work here showing us your work
Glad you're liking it!
I did this in California, it took 5 years, the lot cost $240k we spent $6,600 in civil engineer to draw the map for the subdivision, and the subdivision cost $36,000 from the city and involved a series of community meetings spaced 6 months apart, we had to hire an architect to show what we are going to build cost about $24k… the holding costs on our lot loan for the 5 years ended up being $90K… we shopped around a lot and in the Bay Area the costs for civil map and architect where the cheapest we could find. After the split was done I sold one lot for $200k. So it still cost alot for remaining lot. But if I did it again on this area I would have realized the timing and subdivision cost is the same for 2 lots and 8… so if I could redo it I would go for a lot that could be divided for alot more lots.
The other issue here is no one will accept a contract of longer than 1 month because there is huge contingent of cash buying investors fighting over every possible buildable property. So you have to jump in and buy it fast and deal with a loan or private money investor
That's why you have to find off-market deals that everyone is not fighting for, which I realize may be tougher in your market
thank you!! video was great. Your software is key.
Your videos are the best on the internet. Building my first quadplex next year. Your videos have helped a ton in learning to analyze the land and how the numbers should work.
Best on the internet is a strong endorsement! :) Thank you!
@@RehabValuatoryes it true u explain very well I understand what you are saying 😊
@@SCCP843 thank you!
I third that😂 best overall and unmatched detail step by step guide. 💯😎💎
Thats a fourth for me. I been following and message Daniil in the beginning when I bought land maybe been 4 years now?
I plan to start the build in 2025. Paid off lot.
Thanks Daniil
I see that you are creative and willing to share your knowledge.
Yes, thank you
love your videos - thank you this is very informative I am rewatching this as much as I can!
Glad it was helpful!
Just subbed to your channel! I loved this video because it was exactly the type of investment strategy I was thinking about doing. BTW anyone can totally do this with an FHA new construction loan, they finance the construction period too! The equity in the property will cover the 3.5% down payment requirement. Also, I highly recommend this strategy for someone buying their 1st house! The reason is, you can live on one side, while the other side pays your mortgage! ❤❤
Great points!
@@RehabValuator Actually.... the FHA New Construction Loan let's you BUY THE LAND TOO! Sheesh, this is the perfect strategy for developing a portfolio!
Your a God send.
:)
Thank you for this presentation. I appreciate you sharing your knowledge with us!
My pleasure!
Sounds intriguing! The idea of building rental property wealth without any of my own cash upfront or being tied to long-term partners is definitely appealing. I'm always looking for creative ways to generate passive income and real estate seems like a solid option.
I'm curious to learn more about this "secret" strategy. It would be great to see if it's a good fit for my financial goals and risk tolerance.
Thanks for sharing! I'll definitely check out the training session.
You're welcome! Make sure you watch the whole video
Excellent presentation.
Thank you!
I really enjoy your videos. Somehow they make more sense to me than others out there. My goal is to own a small portfolio of high-quality multi-family units, and this strategy make sense
Love it! Let's go!
Hi @rehabvaluator, thank you so much for your time in putting this great video together..it was truly informative. I’m so happy your video popped up on my feed. Question for you, what if I financed a land and put 20% down and then build a single family duplex. 100% construction loan from the bank as well. Then sell one single family duplex to recover at least 70-80% of the total project costs and keep the other single family duplex as a rental. And then do a cash out refi on the rental for the next deal. Can you help explain the pros and cons to this method? Example, land costs 140k, 20% down payment on land purchase price, construction loan is 500K. After duplex is built, I sell one property for 450k to pay back some of the loan and rent out the other duplex for passive income. Then do a cash out refi on the property I’m renting to put into another deal. I want to learn to invest in real estate so any feedback is greatly appreciated. Thank you!
Glad you're thinking creatively about dealmaking and that strategy certainly can work but I don't have time to dissect your numbers here and coach you :)
Inspiring video! Have you ever had a problem with the buyer of your split lot building something awful next to your property?
It's certainly a risk. If we're going through any type of rezoning, there are usually specific plans that are approved for each lot that buyer must follow. But even if not, you can always try to put in deed restrictions on materials, size of property that will be built etc. It may discourage some buyers - fyi
Amazing video
Questions: So where does the money down come from to secure the land? Would this be the only real hard money requirement? What percentage of money down is typically required for land purchases?
Money to secure the land (EMD) can come from your own funds, a credit line, a short term unsecured lender or a short-term partner. We typically put down a few thousand dollars
@@RehabValuator Doesn't the bank require 15-25% down for land depending on if it's improved or not? If not, that's great! As a follow-up. I guess this structure is dependent on selling the smaller lots that come from the restructuring. Any further guidance on how to streamline the selling of those? From what I hear it can be a long process to sell land. A video on this would be awesome!
Thanks Daniil!!!!
You're welcome!
Excellent video
Thank you very much!
Great presentation! Do you retain control for architectural guidelines for the lots you sell off that adjoin your property? All of your projects are over the top!
Thank you. If it's by right zoning then we don't retain any extra architectural guidelines. If something goes through a rezoning, there are usually very tight architectural and site parameters tied to the project even if we sell the lots to someone else. I just sold 4 lots that come with very specific plans that must be built on them, for example
That's right, Thanks daniil.
You're welcome!
Do any of your ideas/plans work for a SoCal market where labor and land acquisition costs are so high? Thanks for the videos!
I don't know that market so can't say. That's why we teach how to run the #s so that you have the tools to figure that out yourself :)
Thank you for putting this great video out! Question on the comps - where is the comps data sourced, e.g. mls, government data, how up to date are the comps, and what is the granularity, e.g. by zip code, city or county?
Our sales comps and rental comps come from multiple sources and we don't typically disclose them. They're nationwide and it's very accurate data in general.
Hi Daniel. How to utilize the software if you are only willing to sell the house after construction is done? I mean no hold and rent stuff. Just use FLIP calculations instead of RENT/BRRR?
That's correct! Very simple - just use the Flip portion. Check out the 4th video on this page: rehabvaluator.com/knowledgebase
@@RehabValuator спасибо.
Is there a way to get a confirmation from the county that the land is up scalable before paying the costs for a surveyor, land, you attorney, etc.?
I could imagine a scenario where one would spend a couple thousand dollars preparing the application only to then get a no from the county
You won't likely get a definite confirmation but I recommend sitting down with someone from planning department that reviews these types of applications and feeling them out on whether your idea has a high or low chance of going through. A good land use attorney can also give you guidance.
Thanks Daniil, you’re the man!
Do you consult with people? Evaluating and giving your perspective on their deals?
@@jack-ml7br Not at this time
Your videos are amazing! Thank you for sharing your knowledge. I have a question: Do you have a Class A contractor License? Or do you hire a Contractor to build these amazing properties? If so, can you share the name of the company?
I typically hire different 3rd party GCs. That may change next year though. Not in a position to refer our GCs out right now though.
@@RehabValuatorthank you for sharing.
You're welcome!
Could you do a video if you have any experience, in rezoning while under contract - what that looks like and how to make the seller receptive to this and for their permission.
Good topic. I think I touch on that somewhat in the Free Land video but can definitely go deeper
Hi Daniil! Amazing content, I subscribed. I have a a question I need your perspective. I have land in a 1M+ subdivision, free and clear. I would like to build and sell. Do you think it is worthwhile being my own general contractor or would it be better to hire a builder? Happy to provide more detail. Thanks again!
There are pros and cons to GC'ing projects yourself so not really a right or wrong answer. Do you have experience as a GC?
@@RehabValuator I don’t have much experience but I am willing to put in the time and use it as an opportunity to learn. I’ve been trying to gain knowledge which is why I found your channel. What do I need to absolutely have if I were to go that route?
Without experience I would start off hiring GCs and learning as much as you can from them
Can you please reupload it to a higher HD resolution? the highest is 480 quality.
It takes a few hours to render in HD after upload so should be available in higher quality in a few hours
Hi Daniil - Thank you for the great content. I have a unique situation. I have a tri-plex in a popular neighborhood that i purchased in 2017. There is enough room in the back to add a duplex, and zoning allows this. However, my first loan is fixed 30 yr at 4% which i would not want to lose. Would this method work with a second position loan for the construction? Or would i have to refi the whole property (5 units eventual) to a high 6+% rate of today?
I would contact your lender to see if they would release the lien on the rear lot if you separated it out. Can you separate (split) it and build on it by right?
How do you only put a few thousand down? Doesn’t improved or unimproved land require 15 to 25% down?
Not to get the contract. Watch it again :)
Please make a video on managing the construction firm, to make sure they do quality work and don’t go over budget…
Good topic! Will add to the list
New scriber 👍😎🧠
Welcome aboard!
This was pretty interesting. I am in Atlanta Georgia, where it seems in the metro area. They only want multiple single-family homes or large apartments. I also understand that this depends on my credit if I don’t have cash or being able to raise cash is that correct? I was also wondering when I’m able to pull this off I can just start with one duplex, triplex or four Plex correct?
That's one of the problems. Check out the Missing Middle Housing book. Either single family homes or apartment complexes and nothing in the middle. If you can't build in a specific area you have 2 choices: 1. Try to change the minds of local planning and zoning offices or 2. Go do business elsewhere where this type of development is easier to pull off. And yes, you need cash and bank financing to do this - both.
@@RehabValuator OK thanks because I was thinking I may have to go outside of the metro area to do this
Do you have a video explaining how to find land buyers for when you do a free land deal.
No but not a bad idea! :)
Hi, I’ve watch all your videos about the duplex. I showed your duplex design to an architect and he mentioned possible copyright infringement. Can you please provide some context regarding this? I am new to this. Much appreciated.
He's referring to the fact that he can't just use stuff other architects created. That's why we don't generally share plans or even floor plans usually. What did you share with this specifically? Exterior shots of our buildings?
@@RehabValuator I just shared your video.
Genuine Question: are you building new duplexes for $135 a square foot?
You mention new construction at$325k for 1,200 unites. I thought new construction would be closer to $200-250 a square foot
Yes building new for $135/ft not including land. If building larger buildings by commercial code (in my market 3 units and up) it's closer to $185-$200/ft
Thanks for the reply!
What do you think would be a minimum amount of capital to basically guarantee success? Example: 20% of construction costs and 36 months of holding costs.
It really depends on the deal. Hard to say. Also depends on what your outside short-term money sources look like
great job, i wonder if you should keep the thumbnail the same as the others that are doing really well?
Yo Chico! I am actually testing 2 different thumbnails here :) Which one did you see?
@@RehabValuator i saw the one with the green background, not your typical one
So many people aree out there, education courses, it gets pretty exhausting, but I would like to use my VA benefits and assist with my investors but I will need instruction.
Lots of instruction on our UA-cam channel - make sure you check out the other videos!
Hi Daniil , I am very much interested in your training course. Please Guide me further.Thanks
I don't have a formal development course though I am working on something really cool for 2025. For now all of our development content is here on our youtube channel
Daniil thanks for the vid! When you say split by right and sell, what about underground utilities? You sell after you get those in ? Thanks
Good question. If I am selling the lots, I let the buy worry about underground utilities to the lot itself. This is infill development so there's always a sewer and water main in the road. If I was doing raw land development then, yes, I'd get utilities in before selling the lots
@@RehabValuatorso ideally a lot with direct road access and split it and have the buyers individually do the connections to the utilities? So the wider the better for lot ? Narrow isn’t ideal unless price justifies ?
Narrow works too. We build on as small as 20' lots. It really depends on zoning and what fits into the overall neighborhood
Is it possible to partner with u on a 34 acre deal im prospecting in Ohio
Don't really have the bandwidth to partner outside of my immediate area right now. Sorry!
Could I do this in NYC?
The overall concept can work anywhere I suppose. Certain markets are obviously easier to operate in and find inefficiencies than others. I am guessing NYC is not one of the easier markets
What does it mean when you say “buy right”? I cannot find the definition. Thanks.
"By right" means it fits the current zoning. You can just submit for building permits without any kind of zoning changes.
Do you think this could work in Jacksonville Florida? We have what seems like a bad downtown area and outside of that it is a lot of large built communities. What should I be looking for?
From what I know Downtown Jacksonville is going through a renaissance no? Lots of development. The short answer is "yes" I think it can but obviously depends on the #s and many other factors
Do you sell your duplex plans?
We do not. Sorry. I highly recommend you hire a great local architect that understands your local zoning, building codes, construction methods and architectural styles! :)
Я из Сакраменто. Занимаюсь недвижимостью. Учу людей. Давай свяжемся
Калифорния - мусор. Будь настоящим русским и переезжай в Нью-Йорк или Майами :)
Surprised the comments aren't filled with Pace Gator lenders yet 😆
Let's hope it stays that way!
Don’t you need builders license?😊
You hire contractors unless you are licensed to build yourself
Not that easy. All these people got lucky and rich from the 2008 crash. Good luck even getting a loan for the average joe.
I never once in the video said it would be easy. But with your attitude it'll be especially difficult.
@RehabValuator dude you get loans because your already rich.. stop acting like the average joe can just get a loan like u. Not all of us had the opportunity of a 2008 crash like u did.
You're right. You can't do this.
@@RehabValuator ok then stop with the bull..
Great work Daniil! Do banks require vacancy baked into the revenue?
Depends on the deal but often the bank will want you to model a 5% vacancy. On our duplexes I get away with not doing it often as we literally have no vacancy on these. But to be safe you should be modeling a vacancy