Q & A: Remodeling, Financing & What Does Off-Market Mean?

By James Dainard

James Dainard, Co-Founder of Heaton Dainard Real Estate has completed over a thousand real estate transactions in Western Washington. We are giving you the opportunity to ask an expert your top real estate investment questions. As the year comes to a close I asked my real estate team what questions we are getting from our clients. Below are a few of the great questions we received from our valued clients.

“Will adding a bathroom get me a higher return on my investment?”

In one word: Yes, but we recommend that you review the market comparables first to see whether or not it makes sense and whether an additional bathroom will maximize your return on your investment based on your budget. Next, come up with a plan, we recommend having an as-built completed on the existing floor plan. This will help you locate where your current water lines are and allow you to explore the simplest and most cost-effective option. Once you have a defined plan obtain a permit and use a licensed and bonded contractor. When you go to sell the house, this will put the buyer's mind at ease knowing that the remodel was fully inspected and up to code.

“How can I finance my next investment property?”

There are multiple financing options available but in our current market hard money can be your competitive advantage. Hard Money can increase your buying strength by presenting all cash offers for your deal. Always consider your loan options and choose a lender who can supply immediate capital when a prime opportunity hits the market. In most cases, individuals choose to use hard money when they cannot obtain traditional mortgage financing due to inadequate credit, lack of supporting documents, the timeframe of closing, and/or condition of the property.

“I’ve heard the term off-market before but I don’t quite understand what it means, can you explain it?”

Off-market is a term used for properties that are not publicly listed and are not publicly available for purchase. Off-market properties are acquired when an individual or a real estate broker approaches a homeowner and convinces them to sell their home or sign a contract to purchase their property from them. The main takeaway is that an off-market opportunity is technically more exclusive because it is only available to people who know the seller. A common myth I like to debunk is that off-market properties are better deals than on-market opportunities. I see a lot of great off-market opportunities and I see a lot of off-market opportunities that are absolutely terrible. The way to analyze a deal isn’t by how it is acquired, but rather how all of the numbers play out.

There are many options out there in a real estate market like todays. Heaton Dainard’s expertise can guide you through the buying and selling processes. Let us help you decide where you want to invest, and what funding you need to take the next step. Please join us every other Monday to meet our team and learn about the investment process. Visit our website for more information.

About the author…

James Dainard is Co-Founder and Managing Principal at Heaton Dainard. As Managing Principal, he is responsible for the development and execution of corporate strategies, marketing, and property acquisitions. James has been actively investing in multifamily and single family units in the Puget Sound region for over ten years, and leads a dynamic team that exceeded sales volumes in 2015 of over $143 million with over 400 closed transactions. During this time he purchased over $50 million worth of investment properties and sold over $93 million in listed properties with an average market time of 25 days. His business acumen adds value to Heaton Dainard by providing investors with inventory and multiple exit strategies. James graduated from University of Washington’s Foster School of Business with a focus in finance and marketing, and was recently honored by the Puget Sound Business Journal with the 40 under 40 award which recognizes business and community leaders under the age of 40 throughout the greater Puget Sound.

REAPS is the oldest – and largest - Professional Association for the real estate investor this side of the Mississippi. We provide education and networking resources for real estate investors, those who want to be investors and anyone who provides value to our members. Our goals are to motivate and support our members and guests through education, discussion, legislative action, and networking. We host over 40 live events a year around Puget Sound and they are all open to the public. If you've never attended one of our meetings, just email our office at [email protected] and be our guest for free!"

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