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Tag Archives: hoarder houses

Parkwood Progress

Honest, there’s less of this now! Parkwood will return to being a good family home, and soon!

One of the things you have to do to get a bank loan on a house you plan to renovate is to get an inspection, so that the house can be appraised and the loan amount determined. That’s a big reason why many rehabbers rely on other types of funding: we often work on houses that have so many defects it’s hard to list them all. Also, you don’t get to pick the inspector; the bank does. That means you can come up with some unhelpful appraisals, like we did with the big house in Lago Vista.

We have a good relationship with our small-town banker near Cameron, though, so we decided to go ahead with a bank loan for the Parkwood property in Round Rock, since the interest is way better than with a “hard money” loan. So, last week we had an appraisal scheduled.

Carol went over there, arriving a little before the scheduled time, only to find the appraiser had already left. The wholesaler we are getting the house from and the heir to the house were standing around looking shocked. Apparently, the appraiser had hoarder family members and the look of this house was too much for him, perhaps too close for comfort. He was inclined to suggest the house be torn down, and made that decision as soon as he took a look at it. Hmm. That was not our plan. Now what?

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Real Estate Works in Mysterious Ways: A Hoarder House Update

The Hoarder house even has a really nice shed.

You just never know what will happen when you are looking for houses to renovate. It’s a good thing Carol stays on good terms with the people she’s worked with in her house search, because this time, it really paid off.

Remember the “Hoarder house” that Carol looked at a couple of weeks ago? She really liked it as an investment, because while it had a lot of stuff lying around, the bones were good, and it’s in a part of Round Rock where we’d buy houses all day long if we could. However, another investor put a contract on the house before we could, so we moved on to other prospects.

But Wait!

This week, Carol got a call from the fellow investor who had been selling the house. The original purchaser had backed out of the deal, so we got offered the first chance at it. Carol was pretty thrilled to say, sure!

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A Near Miss on a Hoarder House

It doesn’t look so bad on the outside.

I saw an HONEST TO GOD HOARDER HOUSE this week. I’d raced out of the house for an early meeting with a client, totally failing to bring my boots. Yes, it’s August in Austin, Tx and I was wearing open-toe sandals.

My next appointment of the day was with the relative of the owner of the house in question. Sadly, the owner had been rushed to the hospital earlier in the week and according to this fellow, he’s been diagnosed with brain cancer. So he was quite unavailable.

About the House

The home is a 1-story, and its lot is the largest in the cu-de-sac. I was excited at the prospect of finding my next rehab. I’ve been investing in real estate for about 15-years now, and my favorites are homes which have double side gates and room for a great workshop out back, or the addition of an additional dwelling unit in the backyard. This home fit the bill.

The man I met was son-in-law to the owner and he was horrified to find the home in the state that it was. Apparently, it had been a long time since they’d come to visit, and the mental health issues his relative was dealing with hadn’t been apparent. They live in Arkansas on 23-acres. The property apparently, keeps them very busy.

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A Joint Venture in San Antonio?

Two Dumpsters in front of St. John

Yes, there are two dumpsters in front of the house. The GC for this project actually filled and hauled off three dumpsters before she could safely start work.

Yes, we work anywhere we can find the right deal. Even as far away as San Antonio—where the newest deal brought to us by our friend and joint venturer Larry is located.

St. John’s house isn’t really a hoarder house. It’s just been very neglected for a very long time. It may be the dirtiest house we’ve attempted to redevelop to date. I’m glad Larry is taking the lead on this one.

I should have more pictures later this week when I go to see it first hand for the first time.

This house is in an area that is undergoing substantial gentrification. Several houses with a few blocks and on the same street have been bulldozed to make room for McMansions. We won’t go that far with this house, but the house won’t be recognizably the same when we’re done.

So What Is a Joint Venture Any Way?

Simply put, a joint venture is a contractual arrangement between two or more entities (people, corporations, or some combination) to undertake a specific project through a Joint Venture Agreement (JVA). The JVA specifies how much each entity is responsible for the project in terms of money, time, or effort. In real estate redevelopment or construction, joint ventures often enable the venturers to pursue more or different deals than they could on their own.

fistbump

A successful joint venture is a win-win.

In this case, the joint venture is between Hermit Haus Redevelopment, LLC and Andress & Three, LLC.

When Hermit Haus enters into a joint venture with another company, we always spell out who is responsible for managing the project and who is responsible for managing the money. Since there is considerable overlap between these two responsibilities, we end up with some level of checks and balances.

We split the costs and rewards evenly between the venturers. The JVA states that the money manager has to publish state of the venture reports at least once a month. That way the venturers all have an opportunity to see where the money is going and with more eyes, the project, hopefully, has a better chance of success.

Is joint venturing with other investors the way to go for you? Maybe. There are a lot of considerations, and only you can decide for you. And as with any legally binding contract, have your own lawyer look over the contracts before signing.

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