Chris and Jan Land Developers (Part 1)



Aerial view of Elwood Park with arrow pointing to the Lot

About 5 years during the height of the real estate boom and about 6 months before it imploded we purchased 4.4 acres of vacant land in an area of Bradenton called Elwood Park.  Elwood Park was originally subdivided ~50 years earlier and at one time was an outpost on the Braden River that feeds into the Manatee just east of downtown.  The property belonged to an estate and had been "lost" for 50 years. For some reason someone had continued to pay the taxes and now there were over 25 heirs to the former estate. Apparently the guy had bought it as an investment, never used it, and died.  I drove by this property every day on the way to work and one day saw it was for sale - so I started to look into it.



8 lot subdivision concept

The thought was to sub-divide the property into 8 lots and sell off the lots and in the process making lots of money.  The property was approximately 300' (frontage) by ~600' deep.   It had never been developed and was heavily wooded and very overgrown.  The first time we attempted to walk the property it took us over 30 minutes just to get halfway into it.  Buying the property and walking through it turned being the easy part.


The first task was to clear the under brush which included an amazing amount palmetto bushes.  We took several bids and eventually ended up with a local firm.  Before bidding I encouraged each contractor to look at the property before hand whcih most of them did.  I also negotiated the hauling off of the debri as part of the deal (this would prove key a month later).  Others would just throw out and number and hope that it stuck.  I finally agreed to terms with one and they began clearing after a week or so. 

After two weeks of non-stop clearing and taking more away than thirty 30 cubic yard roll-off containers of debri I started to get some push back from the contractor.  In addition to alot of trash, they had also found over 200 tires on the property which apparently had come from the adjacent property over the years (but no way to prove it).  The place was so overgrown you could not see the trash or the tires.  He had underbid and was complaining about how he was losing money - the original contractor had also sold the contract to a buddy who was actually doing the work.  We finally worked it out after some haggling and he was gone.   I ended up spending alot of time at the lots after that hand clearing areas and taking another 5-10 truckloads to the dump.  Everytime I looked around I found more garbage and trash under brush and alomost all on the north side - it had become a dump for the neighbors after all those years.

More in Part 2 of Chris Amstutz the Developer..

On the Hunt for the Next one - Could it be a short sale?

Jan's bored and looking for another project.  No rest for the weary!

 We are looking at two properties this week - the first one's a one bedroom condo a couple of buildings south of our place on Lido Key with marginal beach views.  The other is a three bedroom, 2 bath, 2 car garage condo near the first one with beach views that we could easily live in.  The one bedroom is a short sale for $90K, the other one is $595K - wow!!

It seems it's hard to find anything less than $100K around here and most one bedrooms sell for ~$150K so we could be on to something...This would be a good winter project and hopefully (god willing) we can clean it up, add some paint, and new furniture and flip it within two months during season.  This means we'd be done before April and just need to sell it.... which always puts us on hold before we buy the next one.

A short sale also takes longer.  Depending on how closely the seller is working with the bank the price may have been pre-negotiated in advance. Essentially the bank has agreed to write down the difference.      However, it's not uncommon that when you make the offer on a short sale property it takes up to 45 to 90 days for the bank to approve the deal.  In the meantime they hold the money and kinda put everything on hold while you are patiently waiting.  I'm not sure what takes so long but in some cases we've seen some amazing deals.. 

The one bedroom deal short sale for $90K has a first mortgage of $222K and a second mortgage of $60K for a total of $282K.  This means the short sale is 32% of the mortgaged amount.  Hard to believe but there are lots of those around here - Welcome to the epicenter of the mortgage crisis.

Wish us luck

If you are interested in educating yourself about Short Sales there's a ton of information on the internet.  A Couple of links that I found useful are listed below.

Short Sales - about.com

Short Sale Process

Our First Beach Place

After a two year search from Anna Maria Island to Siesta Key (and Longboat in between) we finally purchased a place at the beach on Lido Key a barrier island in Sarasota, Florida.  Over that two year period we looked at hundreds of properties, made over 10 offers, and drove 100's of miles.

In the end it came down to "lifestyle" and we had to chose between two places one of which we had previously made an offer that was rejected and now the owner wanted to accept the offer since another one he had fell through and the market had changed.  The other unit was close to an area we both loved and had spent a lot of time at over the years.

The place we did not select was a condo in Bradenton beach in a development called Bermuda Bay Club.
It's located about a haf mile north of Cortez on the bay side.  The unit we were looking at was one of two in the last building facing the bay.  3 stories, 3 bedrooms, 2.5 baths and a 2 car garage - 1700+ sq ft.  It was about 10 years old and had three balaconies, two of which faced the bay.  Looks of extras and probably at one time was the model for the development.  During the peak the unit sold for $900+K.  The beach is about a 2 minute walk but you can't see it from the unit.  There are some local buisnesses but the walk took you down the main drag and in some cases you took your life into your own hands.  Basically you had to drive to get to the good places.

The place we did select was a condo on Lido Key in a building called Lido Shores.  Its located about 5 minutes walk from one of the premier shopping and dining areas on the west coast of Florida called St. Armands Circle. 


View Larger Map

Lido Shores is located across the street from the Lido public beach.  The unit we selected is on the fourth floor and we have a view of the beach and the homes around St. Armands when looking out the east side.  2 Bedrooms, 2 bath, 1250 sq ft. with covered parking.  The unit was less $$ than the other and needed some work as parts of it had never been updated.  The Kitchen however had been redone and opened up to make a great room with the dining and living area. 

In the end we decided we liked the idea of parking the car on Friday and not having to drive anywhere since everything was close by.  Jan even created an office for me on the enclosed porch where I can work out of rather than head into the office - I actually get more done there!  What's not to like - plus now we've decided we like living at the beach so much we're thinking of selling this one and getting a bigger place.  If you're interested drop me a line..  If you are interested in a seasonal rental look for us on Facebook.

Beach House Withdrawl

 

Lido Shores Condo 350 South Polk Dr



We started cleaning up the Beach House (condo) today since we are about 2 weeks away from moving out for 4 months while it's rented during high season.  In fact we've only got three renters over the four months of 2011 (Jan - Apr) and two have rented from the previous owner (who we purchased from) in the past.   There's a one month minimal rental period in the building and about a third of the owners rent.

Since we purchased the unit we have spent a considerable amount of time here and in fact have lived here continously for the past 3 months of 2010.  We were unsure if we'd really like it down here all the time and what we've found  "WE DO".  In fact we've already started a search for a bigger place that we can live in and have intentions of selling the house.  Yeap the house where we've lived for the past 10 years and finally got to just where we like it.



The Office that Jan set up for me



Living at the beach has been both relaxing and a lot more work.  Not only did we rehab the place but I also found that I ended up working out of the condo when I was in town.  It helped that Jan set me up a little office on the back porch when I was in China - it was a nice surprise when I got back.  I found that over time when I could not sleep I would starting checking emails or catching up on other work related tasks - hence the problem.  I work more at the condo that I ever have.  There's something to be said for getting up and going somewhere, like an office, and not starting work at the crack of dawn.  I'm an early guy anyway and when there's stuff to do I find it hard to lay in bed with my eyes open.

Our friends the Maguires

It is nice though to grab a cup of coffee, throw some clothes on, and walk across the street to the beach.   Or when it was a little warmer I'd do 5 miles to the bridge and back and then cool off in the ocean before tracking sand and water back up to the unit.  It's hard to explain how it decompresses the soul - perhaps it's the sound of the waves and water..

We've also had a lot of fun with our friends over the past 3 months.  The sunsets are spectacular here and our ritual seems to be sunset on the beach with cocktails or wine followed by a nice dinner upstairs or at the circle.   We've had a bit of a revolving door which we like and will miss the place over the next four months.

I consider us extremely lucky because never did imagine we'd actually have a place like this.  Now that we do we will be working even harder to get an even bigger an nicer dream.  All those nights, weekends, aches, and pains all seem worth it now.  Happy rehab and come visit us sometime, we'd love to have you.

Living the Dream on Lido



Selling Rehab 4470 - Yahoo

We should be selling rehab 4470 tomorrow.   We have learned some very valuable lessons on this one and pretty much will break even on our investment.  However we lose the sweat equity which in some cases is very hard to quantitate outside of a lot of nights and weekends.  If I had to list the biggest factors into why it took 8 months to fix up and sell -our longest ever it attribute it to the following factors in retrospect.

Stick to your market

Traditionally we have worked in the <$200K market.  This way our first foray into the $200K + market and we found that there were just less buyers that were willing to pay that amount in the current market conditions.  So back to the basics!  There are also more buyers at lower prices.

Don't underestimate Negatives

This house had a few negatives that in the end were greater than we originally thought.  The first negative was it was a large house with only two bedrooms rather than 3 bedrooms.  Another was the back yard backed up to a fence and behind the fence was a ditch.  Several buyers said they liked the house but the back yard was just two small.  As a point of reference the house we flipped before this one had a wall and a busy street behind it - however there was room for a pool between the house and the wall.

Don't over improve

This can sometimes be the hardest thing to do.  This house had about 300 sq ft of tile in the kitchen and hallway that we jack hammered out and replaced with 18 x 18 tile.  Did we really need to do this?  It probably added $1000 in cost and a month of time between removing the old tile, jack hammering up the old thinset, and putting the new tile in.  It seemed like a good idea at the time.  We also took down a small wall between the kitchen and dining room and rerouted the electric - it ended up looking realy good but it can't say it helped sell the house for any more than we did.  Look at improvements really close - its easy to go over board.  At the end of the day the more you do the longer it takes - the longer it takes the more it costs and the market can change even more and usually not in your favor these days.

In retrospect we learned alot in doing this house and alot of it was what not to do.  the house turned out great and we are very proud of what we did.  I'd rather have money in the bank and have done less and gotr rid of it sooner. 

Guess we paid for that lesson with sweat equity - happy rehabbing.