Price Reduced – Victory Commons Condos – $249,900

The developer (who still has new units for sale) slashed their own prices 20%, so we slashed our own to stay ahead of them as the best priced unit in the building!  I would choose this over the Lofts on E Boyd in a heartbeat.

Specs:

2 beds/2 full baths, split away from each other.
10′-12′ ceilings
Granite counters, stainless appliances
REAL wood floors!
Gated community with covered parking

Description:
Incredible value for immaculately maintained luxury condo Across from Fieldhouse just north of the gates of LSU, Victory Commons Condominiums provides excellent style with convenience and security. High ceilings and real wood floors lead from the foyer into the open kitchen and living areas. Stainless steel appliances and granite counters compliment the high quality cabinetry which also feature under-mount lighting. Track lighting in living room can highlight your favorite art, photos or posters. Bedrooms are very generous, each with their own bathrooms, with a double vanity in the master bathroom. This is the deal you are looking for in a condo by LSU!

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– Grassroots Real Estate Group

Keller Williams Realty – First Choice
David: 225.772.3283 (DAVE)
Jonathan: 225.938-4653 (GOLF)

37325 Market Place Dr. Ste D
Prairieville, LA 70769

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Real Estate Investing Trainwrecks to Avoid

I saw this post on my LinkedIn page today and thought I’d share it.  It pretty much sums up everything we’ve learned helping others invest in real estate and creating their portfolios.   Check out the link here.

If nothing else, the photos of ACTUAL trainwrecks here are quite fascinating.

4 Ugly Real Estate Investing Train Wrecks and How to Avoid Them

David Madaffari
Rainmaker, Grassroots Real Estate Group
Keller Williams Realty – First Choice
Office: 225.744.0044
Cell: 225.772.3283 (DAVE)
37325 Market Place Dr. Ste D
Prairieville, LA 70769

Cleaning Stainless Steel – Simplified

Skip the commercial stainless cleaning products – a hot water cloth, then WD-40 wipe down.  These are the ONLY things you need to keep your stainless appliances looking great.  This stove is over 5 years old and it looks great – way better than some 1 or 2 year old appliances we see in homes we show.

IMG_2220

David Madaffari
Rainmaker, Grassroots Real Estate Group
Keller Williams Realty – First Choice
Office: 225.744.0044
Cell: 225.772.3283 (DAVE)
37325 Market Place Dr. Ste D
Prairieville, LA 70769

How to Buy a HUD Home, Part 3 – Tips and Examples

Now that you have an understanding of how to negotiate a HUD home and are aware of their inspection practices, I wanted to finish this series with just some tips from my experience that could also help you along the way and maybe save you even more money along the way.

  • List Price Vs As-Is Price – When viewing a HUD home on their website at www.HUDhomestore.com you will notice that they will show two prices: List Price and As-Is price. The List Price is exactly that – what they are currently asking for the property. However it is the As-Is price that can help you determine when a good deal is near. The As-Is price is the appraisal that HUD received when they acquired the property. When the List price is below the As-Is price, then you know the property has good value potential because it has been on the market for awhile and/or needs work.
  • Appraisal – When financing a HUD home, use that As-Is price to your advantage. By acquiring HUD’s appraisal after having your contract accepted (which they usually give you) you can save yourself $300-$400 from the lender’s appraisal. It may take some convincing of the underwriter to use it, and it usually depends on what date the appraisal was completed on.
  • Closing Costs – You can always ask HUD to pay for closing costs during the bidding process but it is not for specific items. For example, if you wanted $3000 of your costs plus a $250 flood elevation certificate, you would ask for $3,250 and pay for the certificate yourself.

Most importantly, choosing a Realtor experienced in working with HUD properties is paramount. I have navigated many different HUD transactions with unique challenges to each of them. The common component is that every single one of them CLOSED on time. If you’re interested in a HUD home, call me and let’s get started!

Sincerely,

David R. Madaffari, Realtor
Keller Williams Realty – First Choice
Office: 225.744.0044
Cell: 225.772.3283 (DAVE)
37325 Market Place Dr. Ste D
Prairieville, LA 70769
www.DavidMadaffari.com
Each office independently owned and operated

How to Buy a HUD Home, Part 2 – Inspections

In our last entry, I talked about some tips and tricks from experience on how to negotiate a HUD home and land a great price. Today, I will discuss the inspection process as it is a little different than a typical inspection.

Before bidding on any HUD home, you should have reviewed the Property Condition Report (PCR) and the Seller Disclosure addendum. The PCR is the result of HUD’s own inspection but it is not very thorough. To determine the viability of the electrical systems and items they hook up a generator to the home and try to power the different systems. To test the plumbing, they run compressed air through the main water line into the house and test whether it will hold pressure at 30 PSI and if it does not they will determine that the plumbing “has issues.” But so far in all of my transactions, the reason for not maintaining pressure has just been because a faucet wasn’t turned off all the way.

Sample PCR
Sample HUD Seller’s Disclosure Addendum

HUD’s process to do your own inspections can be tedious and stressful if you need the utilities turned on. While an inspection period is typically 10 days, HUD gives you only 3 days for you to have the utilities turned on. To do so, you have to get written approval through the Asset Management Company responsible for the home, and that can take 2-3 days by itself. This process could be a non-refundable $50-$150 JUST to turn the utilities on and subsequently turned off.

Because all HUD homes are sold “AS IS” the inspections are for your own information only and HUD will not do any repairs. The lack of repairs and condition of the property is the trade-off for better deals that usually have equity built right into them. If you are willing to roll up your sleeves and are not afraid of unforeseen issues, HUD homes can be very good investments either as your primary home or as a rental or flip.

In the final installment, I will provide some anecdotes on particular deals and how I resolved issues as well as any “odds and ends” that can help you navigate the world of HUD homes.

Sincerely,

David R. Madaffari, Realtor
Keller Williams Realty – First Choice
Office: 225.744.0044
Cell: 225.772.3283 (DAVE)
37325 Market Place Dr. Ste D
Prairieville, LA 70769
www.DavidMadaffari.com
Each office independently owned and operated

How to Buy a HUD Home, Part 1 – Negotiation

Buying a home through HUD can be a very exasperating experience, even for a well-versed Realtor. Because HUD is a government agency (Housing and Urban Development) you can imagine there is a decent amount of bureaucracy beyond simply bidding and providing funds like a normal transaction. After completing 6 of these deals this year and a 7th under contract right now, I thought I’d give some tips to both buyers and agents alike on how to negotiate a HUD home deal.

  1. Bidding and winning is easy – it’s the PAPERWORK after an accepted bid that can be trying. When making your bid, make sure EVERYTHING is the way you want it to be on the contract/deed before submitting. If even one letter is different on the final contract paperwork, they will cancel the deal and make you start all over again. HUD is a stickler for minutiae.

 

  1. Bid low, ALWAYS – This seems like common sense, but I mean aggressively low. What you want is for HUD to send you a “Bid Counter Notice” email. In that email, HUD will actually state what their minimum net after concessions is! This allows you to calculate to the penny how much you need to bid in order to meet their minimum. For example, when HUD told us they wanted to net $132,800 on a property, I calculated that after HUD’s 6% commission our exact offer would have to be $141,276.60. No need to pay more than necessary!

 

    1. Always submit offer to be held as a back-up offer – This goes with the item above, because what can happen is even the minimum net HUD sets on a property will be too high for any bidders. By allowing them to keep your offer as a back-up, it will automatically be resubmitted every day or so AND when they change the price/minimum net. This saves you time because you will get the new minimum net each time they change it – WITHOUT having to watch the property and bid every time. I had one go on for 3 months as they kept lowering the price all the way to our original bid. Patience IS a virtue.

 

    1. Make a list and check it 14 times – When winning a bid, HUD gives you 48 hours to have the entire contract package sent overnight to them. That’s $20 each time you mail something. So do your very best to make sure you followed the instructions EXACTLY as they specified. Even if you are 99% confident, you may still get an email stating the package is incomplete. Some items can then be emailed to them, but be prepared to overnight materials as needed.

 

    1. Closing is as quick as you want it. Once you get a contract fully executed, closing a deal is pretty quick. Send your contract package to your preferred title company and you could be closing in a week (of course for financed sales it could be longer). The point is that the biggest hurdle has been crossed.

I have found that HUD typically gives better deals than a typical bank does on their foreclosures because they price their homes more realistically to the condition of the home. In our next post I will discuss HUD’s inspection process as it is also quite different from a typical inspection

David Madaffari
225-772-3283