How to Develop a Build to Rent Duplex (How to Build Ground Up Real Estate)

In-depth training video on developing rental duplexes ground up, including how to determine value of land, perform due diligence and line up financing!
Links from the video:
Land Due Diligence Checklist: RehabValuator....
Free Land Video: • How to Get Free Land! ...
$1 Trial of Rehab Valuator: RehabValuator....
Topics we cover in this training:
Why duplexes are better than single family rentals and will make you more $
The full development process outline
3 most important financial metrics when evaluating build to rent deals
The one factor in development you have most control over
Do deals still pencil out in today's market? I address that
The 8 Vital Steps to Deal Financial Analysis and figuring out the offer you must make for land!
Why I don't like 3 Bedroom units in my properties
How to figure out construction costs on your project
The concept of "Max Leverage" and why it's crucial to understand it in a shifting market
The smart "leverage levers" you can pull in order to be able to borrow more $ and need less cash!
Vital Due Diligence Steps you must take to protect yourself against buying land you can't develop
How to structure your financing (cash vs. construction)
Multiple creative options you can use if you lack cash
The BIG advantage to development vs. buying existing assets
And much more!

[@alejandrocabagne2375]

One of the most comprehensive lectures on the web. Thank you sir.

[@RehabValuator]

You're welcome!

[@MrMcGoooo]

I work as a superintendent for a large Multifamily developer (merchant builder). Lately, I’ve had feelings that maybe I could do this myself, but ultimately I think what’s holding Me back is fear. Videos like this really help chip away at that fear. Sincerely, thank you Sir!

[@RehabValuator]

Really glad to hear that! You already have the construction experience. If you combine that with knowledge on putting deals together (finding land, securing $ and entitlements) you'll do great

[@yadeno6169]

I'm rooting for you sir!

[@jk6343]

The devil put that in your heart

[@MrMcGoooo]

@@jk6343 how do I get in touch with him to return it? Lol nah, it’s past experiences/trauma and abandonment that puts limiting beliefs in our minds. Most importantly, the vast majority of people we run into on a day to day basis are people who secretly don’t want to see anyone do better than themselves and will often go out of their way to make sure good things are less likely to come your way. Or they will try to talk you back into mediocrity so that you’re not a risk of becoming a personification of their lack of drive.

[@Juvvgarcia_]

As someone who is brand new to developing and seeking to learn this is the best educational video I’ve found thank you for putting this out! 🔥

[@RehabValuator]

You're very welcome!

[@jeremytorres973]

Hey if i paid you would you help guide me through this process? Please im trying to buy my first home and would love to do this. I am a realtor and understand most of the process but i am still afraid to proceed without an experts guidance.

[@RehabValuator]

@@jeremytorres973 we don't offer one on one consulting or coaching right now. We do have a group mentoring program but even there we don't really take people by the hand - it's more of a mentorship group where you can ask questions and get advice

[@jeremytorres973]

@@RehabValuator well how can I join?

[@RehabValuator]

@@jeremytorres973 www.RehabValuator.com/inner-circle

[@Michellemybell739]

I’m an agent turned new developer here in Atlanta and it’s been an uphill battle for me and my partner the last couple of months but we have several deals in the pipeline. This video sheds a lot of light on that entire process. Love it! Thanks so much ❤

[@RehabValuator]

Really glad to hear it and you're welcome!

[@vernessachester2003]

Hey Michelle, What area are you building in? Thanks

[@Michellemybell739]

Georgia

[@robertbird3754]

Thank you! So many people watch HGTV and want to be Chip and JoAnn Gaines. No one goes into the actual important specifics/details. Will be recommending you and your channel. Sending positive thank you vibes from Chicago.

[@RehabValuator]

Appreciate the kind words and you're very welcome!

[@BJ-fu4zy]

Currently building first duplex in Georgia! Awesome vid

[@pimpinaintdeadho]

How are land/real estate prices in your area?

[@BJ-fu4zy]

@@pimpinaintdeadho Bout $150-$160 a sqft

[@uhhcrave]

what part of GA, BJ?

[@BJ-fu4zy]

@@uhhcrave Richmond county

[@414monii]

What’s the build cost?

[@johnjv24]

This type of project is what I am looking to start this year!! Thank you for this video!!!

[@RehabValuator]

Let's go!

[@kaputoloolenaidkng]

Did you start yet??

[@johnjv24]

@@kaputoloolenaidknghoping to start by January or February. I had to get a GC for the loan but just need to sign contract with GC which happens to be my ex-boss that is helping me out.

[@johnogilmorejr6691]

Finally, I see light at the end of the tunnel. Thank you! It's refreshing to discover a developer with heart! I ordered Missing Middle Housing. In time I will subscribe to your software. BTW: I lived in Richmond years ago. A friend built a recording studio in your neighborhood. I remember standing on the street, looking around and thinking "someday, this is going to be a gold mine". Good to see I wasn't wrong. Congratulations!

[@RehabValuator]

Appreciate the great feedback. And yes, Richmond has come a long way!

[@KamilahOwens-p4y]

I’m enjoying this breakdown. Thank you.

[@RehabValuator]

Very welcome!

[@rosanneallen-hewlett9973]

Please be sure you don't overcharge rents, and install effective sound board on the second floor. Otherwise it's misery for the resident downstairs and they don't stay. This is part of providing something better. Thank you. -R. Interior Architect. ⚘️

[@PristineFiber]

Amazing info. Much appreciated. Your hard work did not go unnoticed. Thanks.

[@RehabValuator]

Glad it was helpful!

[@ColbyCBoone]

I found this information extremely valuable , you have certainly earned my business & I will be giving Rehab Valuator a spin ! 🥂

[@RehabValuator]

Glad you found it valuable, Colby and look forward to having Rehab Valuator be a valuable part of your biz as well.

[@LimitlessSoulJourney]

New sub! We are preparing to build our 1st duplex with our VA loan. Currently own other properties.

[@RehabValuator]

Awesome! Good luck with that first one!

[@ramezqubain8177]

Exquisite presentation. I have been using Rehab Valuator but in this video I learnt the concept of maximum leverage and how to solve for it using the other parameters.

[@RehabValuator]

Ramez! Good to hear from you bro. Yes maximum leverage is a crucial concept and right now is more important than ever to understand given what rates have done.

[@denisetaylor8279]

This video has been so helpful. I’d like to thank you for taking the time to share. Someday I’d like to become a developer. Your training answered a lot of my questions. Take Care!

[@RehabValuator]

Thanks for watching and I am glad the video was helpful!

[@Dylan-kj5sz]

My wife and I have a couple rental properties and have been recently flipping, but have wanted to invest the profits into long term holds. This has been the most informative video that I have watched on social media. In fact, I have now watched it three times and have learned something new with each time. Thank you for creating this content.

[@RehabValuator]

Glad you're not getting tired of my voice after 3 times! :)

[@cookiedestroyer19]

Trying to buy my first plot right now and build a duplex on it. The land has a slab and the city council will have to approve my duplex so there’s some obstacles foreseen. This is a helpful video. Thank you

[@RehabValuator]

We deal with this kind of stuff all the time. Love those kinds of deals because others aren't willing to take them on!

[@2516westbrownstreet]

Always an in depth tutorial. I appreciate you sharing so many insights about duplex and four unit development. This is what I' m getting ready to launch in spring 2025. I have yet to see anyone else going as deep into the mechanics and concepts of infill development as you sir. Thank you.

[@RehabValuator]

Good luck in 2025! And stay tuned - lots of additional deep dive development content coming here.

[@pimpinaintdeadho]

Daniil, thanks for all of your valuable insight. I wish I could put this theory into practice but, in my local market, real estate is massively over valued currently. The fundamentals of income to rent/mortgage costs are not aligned. Rents are plateauing in the metro Nashville area. I'm very apprehensive right now. Anyways, thanks for the uploads and keep em coming!

[@Ddimarco]

Land is too expensive in Nashville. Has to be sold as NOO Airbnb outside the city. Not worth the risk in my opinion

[@RehabValuator]

Check out the Free Land video I link to at the top. There are always creative ways (that very few people know) to general cheap land basis even in tougher markets

[@sergioluna6203]

Reaaaaalllyy good materials. And info.

[@RehabValuator]

Glad you think so! Thank you.

[@jeromeknight2855]

New sub as well!!! Looking forward to applying the principles learned here in St Louis Mo. Loving the features of the online tool, makes it a lot easier for a noob.

[@RehabValuator]

Glad to hear it! Welcome aboard, Jerome!

[@tayloralfers9501]

@RehabValuator This is awesome! I would love a video on the other steps in your roadmap at the beginning of this video. Designing the project, getting bids, submitting for permits, etc!!

[@RehabValuator]

For sure. Got more videos coming. These just take a while to put together.

[@RehabValuator]

Leave us your comments/questions/feedback! What other topics do you want videos on?

[@td000]

is this Canadian specific content?

[@RehabValuator]

@@td000 We are based in the US. But you can apply this logic (and software) to Canada as well. No reason why you can't other than that your government is a disaster and your real estate prices are out of control 😀

[@TruthTellers_100]

What to say to developers when we call to find out how much they are paying..

[@RehabValuator]

@@TruthTellers_100 you say "hey how much are you paying for x?" Don't overthink it

[@tayloralfers9501]

@RehabValuator would love a video on the other steps in your roadmap at the beginning of this video. Designing the project, getting bids, submitting for permits, etc!!

[@Taylor-kd6lr]

This is fantastic Daniil. I have been following you for a while now and love your presentations. They are easy to follow. It is my goal to sing up for one of your mentorship programs, so I can learn so much more from you in person!

[@RehabValuator]

Glad you like them! Look forward to you signing up!

[@LimitlessSoulJourney]

Your software program is quite impressive. 🙏

[@RehabValuator]

Thank you! We've put a lot of work into it. And still updating/improving every month.

[@LimitlessSoulJourney]

@RehabValuator We will definitely be using it soon! It's a no brainer!

[@kennethscurrymyenterprise]

The software is powerful. Im not into new construction or rental property but I will definitely recommend your software to my construction contacts

[@RehabValuator]

Thank you! We help wholesalers and rehabbers as well, big time - FYI

[@donanyiwo9538]

Awesome video Daniil

[@RehabValuator]

Thank you!

[@Kingjoshy2067]

Wonderful video!!, I plan on building a duplex please do you have any video to teach beginners cause some of the terms are alien to me?

[@RehabValuator]

Check out the rest of the content on our youtube channel. It's great for beginners. If there are terms you don't understand, the internet is an amazing resource - look them up

[@lesliethompson8846]

Thanks Daniel.. great video

[@RehabValuator]

My pleasure!

[@SouthOCTennis]

So good. This is exactly what I need. I have free land, bc my project is on a property with a unit on it already.

[@RehabValuator]

Awesome! Nothing beats free land

[@SouthOCTennis]

@@RehabValuator your a great communicator, thanks for all the free content

[@marioarcari7649]

this is fantastic content , invaluable information , worth its weight in gold . thanks D

[@RehabValuator]

Glad you think so! Appreciate the great feedback!

[@ncedobonga5772]

soon!

[@RehabValuator]

Let's go!

[@ben-rlty-inv6663]

I've been watching you for years now. I'm here in Richmond with 5 single family homes and I would like to turn them into duplexes and maybe a 4plex but can't seem to run into the right builders. I'm going to try to get some plans to get quotes.

[@RehabValuator]

Small builders that can do a good job are actually harder to find than those that can build large commercial projects. I feel your pain!

[@BJ-fu4zy]

I would pull permits at the county to see who's active and call them. Or drive around and look in the construction boxes on site

[@Man-u-flex]

Why not 8-10 units

[@riumudamc4686]

Daniel, the hardest part of this process seems to be estimating the rental income. You are very familiar with your market which is an advantage. How do you recommend someone learn rental comps and what the demand is for a new market? Thank you

[@RehabValuator]

Well for rental comps, I am partial but I do recommend Rehab Valuator Premium. As for what's in demand, talk to local people. Talk to local investors. Look at your specific target area and look at all the rental listings. What is there a lot of? What is lacking? Call around to some of the larger apartment buildings and find out how many units they have vacant. That will tell you if they're renting out their 1st quickly, 2s quickly, etc. Talk to local management companies - same thing - ask them what they're renting out quickly and what's sitting for a while.

[@realestatesterling]

Great video Daniil. Thank You!

[@RehabValuator]

You're very welcome. Thanks for the feedback!

[@Cash_Wise1]

Great video,well detailed But if you don’t mind can you please explain how you got the final Max loan amount,im a bit confused

[@RehabValuator]

If you're using the software it'll tell you. If you're doing it by hand, I use Excel to back into the maximum loan amount at a certain interest rate and amortization at x DCR (example max payment that will meet 1.25 DCR at 7% rate and 20 year am). It's an excel formula basically

[@Myrakel-d1h]

Will it be harder for a bank to approve you if this is your first ever investment ? Can you do a detailed video on how the refinancing process works for duplex’s? Thank you ! Great video

[@RehabValuator]

Certainly. Banks feel more comfortable lending to people with some form of a track record but that doesn't mean nobody will finance you. Build a great team around you and talk to lots of lenders. You'll find someone to take a chance on you.

[@KolB_]

Hi Daniel, I've followed your content for a while. I really appreciate the information you put out. It is very helpful to new investors. Question for you: Have you ever built a stacked duplex on a sloped lot? I purchased a property with a neighboring duplex in 2022. There were some septic issues limiting the # of bedrooms that could be housed under a single structure. The water will be connected within the city limits. I was wondering if you've encountered a septic installation issue or if most of your projects have access to city sewer? Thank you for the video and best of luck in 2024!

[@RehabValuator]

Hi. Never dealt with septic. Everything we do is only city sewer/water hookups. Sloped lots can be challenging but really depends on specifics of topo. Can still develop in some cases

[@yadeno6169]

Great video Daniil! thank you for providing really good information!

[@RehabValuator]

You're very welcome!

[@rosemaryk6807]

Great training. Thanks so much

[@RehabValuator]

You're welcome!

[@notrust27]

Great video, very appreciated. Two questions; 1) should we have the land under a contingency agreement before doing the due diligence? 2) how do we determine the market value of the land? Thank you!

[@RehabValuator]

The video covers determining the market value of the land :) Did you watch it? What parts are still unclear? And yes, I recommend having land under contract before you do any real due diligence.

[@notrust27]

@@RehabValuator I must have missed that part, that's why I asked. No worries, I'll figure it out. Thanks for your time.

[@RehabValuator]

@@notrust27 yep. I cover that in this video but also here's another: kzbin.info/www/bejne/foi9iWubmJaXhZI

[@MichaelWashburnSC]

Excellent love the details

[@RehabValuator]

Thank you! Cheers!

[@TruthTellers_100]

This was sooooooooooooo valuable ✔

[@RehabValuator]

Glad to hear that! Makes all the hard work worthwhile!

[@obeto756]

Great presentation and so are all your other videos. Question: How do you soundproof your stairwells?

[@RehabValuator]

Thank you. Stairwell: we do batt insulation and 5/8" drywall on the walls and sometimes will add RC channel. That usually is sufficient.

[@obeto756]

Ok, thanks!

[@muyiwa508]

I really enjoyed this video. It is the best I have watched. Thank you so much. I will like to stay in touch as I have a couple of land I am looking to develop.

[@RehabValuator]

Appreciate the great feedback!

[@siegfriedherrmann5159]

Thank you sir ...for yet another outstanding and highly informative presentation! I just love your presentations and always learn alot from it!!

[@RehabValuator]

Appreciate the awesome feedback and glad it's helpful!

[@rinaldoed7481]

I really appreciate your presentation and the content. I am going to try this out (hopefully, in Texas and California). I will stay in contact and let you know how it goes. Thanks again

[@RehabValuator]

You're welcome and sounds good!

[@rafaelcamposdepinho5088]

Great video! What's the $30k in the LTC calculation (27:37min)?

[@RehabValuator]

It's the soft costs (I cover it earlier in the video I believe)

[@frederickmason9419]

Love the video, thanks for the knowledge

[@RehabValuator]

You bet!

[@passiveincomeac]

Glad I was able to get into multifamily with very little down.

[@RehabValuator]

Nice!

[@LosRigdons]

This is great!! Just what I was looking for to begin my next venture. What happens if there hasn’t been new duplex in years? What do you compare comps to?

[@RehabValuator]

In that case appraisers will either use single family comps nearby and adjust values or use duplexes as comps from further away

[@MusiQuera-x8d]

Do you have a video completing the steps? Would love to see your advise and experience on the second half or 2/3s. Very informative! Thank you

[@RehabValuator]

Not yet but working on additional content

[@therehabbersplaybook6586]

Thanks for this! Hoping for my first in 2024 💪

[@RehabValuator]

Let's goooo

[@erickcanada9500]

I’m in Richmond Va as well. Do you have one on one meetings, ive wanted to do this for a few years now.

[@RehabValuator]

If you're a beginner, then this is what you should join: RehabValuator.com/inner-circle We meet weekly on Zoom but a big contingent of members is in Richmond for you to network with and we do in person meet ups few times a year

[@Flatpockets123]

Hey man, any books you recommend on real estate financing ? Something that goes into detail about the lending process and what banks are looking for etc etc

[@RehabValuator]

Hi Anthony. Can't think of books specifically. I do have a detailed video on how build to rent financing works here if you haven't seen it yet: kzbin.info/www/bejne/e3eye2Rue9Goj7c I am also working on a new video specifically talking about what banks want to see before funding deals. Actually started putting together content for it last week!

[@Kevin-om4yn]

Love the video, You did an amazing job.

[@RehabValuator]

Thank you!

[@GabrielJohnson-u8g]

Hey there love it - inspired me to jump in and I’m under contract for my first deal (land). When you are analyzing soft costs, are you always budgeting for an engineer or is it case by case based on the lot? Thanks!

[@RehabValuator]

Nice! Congrats! We only use structural engineers on commercial projects typically, not residential. If a residential project is big enough (multiple homes or townhomes) we may need civil drawings otherwise that's only commercial projects as well. Same for MEP engineers

[@ChristopherPriceMBA]

Great video. What are your thoughts on Modular Homes for your projects? Would you be interested in a development project in North Carolina?

[@RehabValuator]

Thanks! Not much experience with modular yet and only focused on developments in Richmond, VA currently.

[@coldside2012]

Getting ready to build in Charlottesville, VA! This was very valuable

[@RehabValuator]

My alma mater! What are you building?

[@coldside2012]

@@RehabValuator Duplex, thinking side by side but you have me contemplating top and bottom since its on a slightly larger than average grade.

[@davidadamson3664]

I am almost exactly like you. So much of what you said in the first five minutes is my life right now. Also after building and renting for years, I can sell and hold the mortgages.

[@RehabValuator]

Awesome!

[@DevinMostDangerousGantt]

Does this apply to a quadplex? How does it differ from the duplex model? Just subscribed tonight. 1am im eager to take that leap

[@RehabValuator]

Same exact principles apply to a quad. The main difference is building costs. In your state how many units trigger commercial building code? In my state it's 3. So if I build a duplex, it's by residential code. But a triplex or bigger is commercial. So costs go up quiet a bit.

[@DevinMostDangerousGantt]

@RehabValuator wow. I didn't know that. I thought nationwide up to 4 units is residential. I'm really intrigued in this model though. Thank you.

[@deqasuleiman1290]

Is it possible, when the real state is contructed and stabilizes, to refininance out the all contruction cost, land etc and only have sweat equity tied up to the deal. Is easier doing it duplex, large appartments 150 etc, what do you thing, Daniil. I'ld love to hear your idea.

[@RehabValuator]

In theory it's possible but in reality costs of construction are high right now vs. As Built Values so in most cases you have to leave some cash tied up in these deals for a few years. High interests don't help either. It's certainly easier especially if you're starting to do SFH and duplexes and work your way up to larger projects

[@deqasuleiman1290]

@@RehabValuator It’s been great speaking with you, and I hope to connect again soon. Your insights were clear and thoughtful, especially regarding construction costs and current market challenges. Just to note, I’ll be using Islamic banking, so interest won’t be a factor for me.

[@RehabValuator]

@@deqasuleiman1290 Awesome! Good speaking with you as well

[@luqmanmohammed1730]

This is simply beautiful.

[@RehabValuator]

Thank you!

[@TheComplaintsCoach]

Great video, information and numbers......

[@RehabValuator]

Glad it was helpful!

[@Coemuze]

Thank you for the very enlightening video. Do you just build the houses without garages, greenery etc. I noticed they are all standing alone. Is this because of Zoning requirements? What would you advise, if the zoning law requires a garage, greenery? Does your duplex-style build not allow for garages?

[@RehabValuator]

In my rental projects I never build garages. Doesn't pencil out. We either provide off-street surface parking or they park on the street. In our for-sale product sometimes we'll add garages. As for greenery, we typically plant trees on the street and if space allows we'll addo some backyard or common green space.

[@Coemuze]

@@RehabValuator Thank you so much for your response. I have been judiciously consuming your content on YT. My other question is, For an Owner-Build-Rent-Hold, as I intend to live on the ground floor of the Duplex I wanna build. Do I include my own rent in the Projected operating income? I tried excluding it, and the numbers didn't look good. It affected the ARV, I could n't hit the Cap rate of 7% without reducing my ARV. I played around with my sweat equity, % cost to be financed,and it didn't look good. what do i do pls?

[@RehabValuator]

@@Coemuze If you exclude your rent it'll definitely crush the numbers. But I don't know if the bank will accept your rent in the pro-forma and count it towards DCR. You could always just include your rent and not disclose to the bank that you'll be living in one of the units, then create an LLC that will have a lease with the property and pay rent to yourself through that LLC. That being said I am always a fan of full disclosure and honesty with my lenders. So not the way I'd go about it.

[@Coemuze]

@@RehabValuator Thank you again for responding. I had a chat with the financial institution yesterday, and it was established that since this is my first home, the bank is mostly interested in Debt-Service ratio before I am pre-approved. My spouse is of the opinion we shouldn't include our own rent in the POI. She however, thinks, we should include our utility bills ( electricity, gas, and water) in the POE, that way, the numbers may suck but we will establish the gap we need to pay out of pocket to meet our obligations to the bank. The smaller that gap, the better. Does that make sense?

[@Moochers]

I've been wanting to get into development for a long time. The problem is that I have no money to do so. What I bring to the table is my design background - I have a masters degree in architecture and I'm a project manager (construction document side). I understand code, I know how to navigate the code, I have a network of architects and engineers, I understand how homes are put together. How would you suggest I break into this if I don't have the funds. I would assume the best way is to find an investor (partner?) Perhaps reaching out to builders? Not really sure. I keep saving money hoping to one day buy a piece of land to develop it but I feel like there is something that I could do in the meantime...

[@RehabValuator]

Easiest way is probably to partner with another developer with access to capital. Or just do the deal yourself and raise equity from LPs (limited partners). Here's another way to get into deals creatively in case you haven't seen this training: kzbin.info/www/bejne/fnTEYouIacqpa68

[@Venger02]

Great video!!👏🏿👏🏿💥💥🔥🔥❤️❤️

[@RehabValuator]

Gracias! Glad you liked it

[@Myrakel-d1h]

Would you recommend starting off flipping & holding before building duplex’s ? I love the new construction route

[@RehabValuator]

I certainly think it helps to have some rehabbing experience before jumping into new construction but it's not absolutely necessary.

[@davidharpur6561]

I would like to know about the how to get land for almost nothing or deals with land owners

[@RehabValuator]

Check out this video: kzbin.info/www/bejne/qJuYiqBjgryNkLc

[@fattiejayzz]

Should have just waited , thanks for the thought behind the 3 /1 roommate clause

[@Easy_Wealth_Money]

Does this software work on Canadian market?

[@RehabValuator]

Yes except for the data portion which is US only. But everything else: deal analysis, project management, funding proposals all work great. We have a lot of Canadian clients actively using the product.

[@KD-eq2ch]

Great content! Do you have any duplex designs you can share?

[@RehabValuator]

Sorry but I don't typically share my architectural plans

[@geartechstuff3592]

Hi Daniel, great video and very interesting software! To calculate the build cost do you use the total GIA (gross internal area) or the GEA (gross external area) which includes external wall thickness? If it’s the GIA does that area assume the cost of building the external walls, roof, porches decks etc? Thanks

[@RehabValuator]

Always gross external area for this but i don't include exterior decks in the sq ft calc.

[@buddyrevell511]

@Daniil: in the software, when you increase your loan term from 20 to 25 years, and when you get the land cost down from $60k to $50k, in neither change does your cash flow increase. It just remains $528/month. What am I missing here?

[@RehabValuator]

@43:50 I change to 25 year amortization and cashflow goes to $722/month. Decreasing land purchase price doesn't affect cashflow. It only affects cash on cash return.

[@sayazkou]

You are using less capital to generate the same 528$/month (cash/cash return increase). However, one should also consider that increasing the AM period could also increase the mortgage rate. In summary, the objective of this info session is to provide some guidelines, knowledge, and tools to analyze these types of projects. Thanks @RehabValuator for sharing. Great job!

[@jeffreymerkeley4526]

Danill if you put two buildings together with a common wall on separate lots, will the building officials see them as duplexes or fourplexes for code purposes?

[@RehabValuator]

Totally depends on your state and local code and how local officials interpret that code

[@jeffreymerkeley4526]

@@RehabValuator yes, that is my assumption, any strategies to influence them to non-commercial determination?

[@RehabValuator]

Not really. The code is the code and you're generally not going to sway them to interpret it differently, in my opinion.

[@JigarPatel-t2b]

Great video breakdown! One question, cost to build @21:28 is showing $140 x 2400 = $308,000. Shouldn't this equal $336,000? Just making sure I am not missing any additional calc that went into the cost.

[@RehabValuator]

Great catch! Yes at $140/ft it should have said $336k in construction costs. In hindsight, really what I should have put in the video was $130/ft because that's closer to our real costs so $312k.

[@baoshenyi]

great inspiration video. You have a full time job as software developer? Do property builder as part time job? Thanks 😊

[@RehabValuator]

Not quite. I am a full time real estate developer and am a full time software company CEO. Don't ask me how :)

[@pegpopken]

good explanation of why new rentals cost so much ,

[@RehabValuator]

Glad you liked it!

[@Avelina-e5s]

Very informative Thank you very useful

[@RehabValuator]

Glad it was helpful!

[@matthewmitchell60]

Great video as usual, i wish you would do more of real life challenges investors face. Just a little bit about my situation, i lost my love of my life for 30 yrs to covid19, prior we started investing after i retired in 2018. You speak of credibility we had it, my our credit was damaged once she took ill and the virus took her life. Im 63 yrs old how do a investor build credibility from my situation. By the way no foreclosures or bankruptcy. Thanks

[@RehabValuator]

Really sorry to hear about your loss, Matthew! That's terrible. I have more content coming for sure and will add your suggestion to the list!

[@Beowulf002]

hello daniil I live in an area that has townhomes and condos instead of duplexes, I found a vacant lot of .25 acres and want to build multiple quads on that property. My question is how do you run comps if there is not a comparable product, would an appraiser have to determine the value independently through the bank or would I need to consult with an appraiser to assess the deal?

[@RehabValuator]

From my experience, when there are no duplex comps, an appraiser will use single family comps and adjust them up/down for duplexes. What kind of adjustments they make depends on the appraiser (do they increase $/ft or decrease, etc). What you may want to do is if you have a specific bank identified, confirm they'd be willing to fund them, then ask to speak to 2-3 appraisers they typically go to and ask those appraisers how they'd approach this. The bankers may have some feedback as well. I prefer local community banks for these types of loans.

[@whymindsetmatters]

Would love to hear you speak about setting up your business entity.

[@RehabValuator]

It's an LLC. There's nothing to it

[@whymindsetmatters]

@@RehabValuator There's more nuance to it than just going to legal zoom and getting an LLC. I was just asking about your process.

[@RehabValuator]

@@whymindsetmatters my process is I call my lawyer up and tell him I need an LLC created. He creates it. That's all the legal advice I am giving on here

[@whymindsetmatters]

@@RehabValuator I wasn't expecting that kind of response. Hope your having a good day!

[@RehabValuator]

@@whymindsetmatters don't get hung up on irrelevant stuff like overcomplicating entity creation. Keep the main thing the main thing. I am always having a great day.

[@javit6458]

Hi Daniil, Great KZbin channel. Do you know if building a backyard duplex is possible on a property which has a 30 year mortgage? I have a corner lot that could fit it without affecting me much. Thank you!

[@RehabValuator]

Possible but 2 factors you need to look into: 1. Zoning 2. Would your existing mortgage company allow a partial release so that you can split off that land? Right now the entire piece of land (along with the house) is security for that mortgage. They'd have to allow the split.

[@javit6458]

Thank you. I'm planning to call my city's zoning office to confirm

[@deshawnfernander3004]

When dealing with lenders, do you need to have great personal credit to get approved for construction loan?

[@RehabValuator]

I wouldn't say "great" but yes when dealing with banks especially, they review your credit, income, balance sheet and global cashflow. There are others lenders who do less underwriting on your specifically that will fund construction. Look up DSCR lenders

[@seanjames9859]

Please confirm, when you say you can get" 90% of construction costs financed b/c you are bringing so much of the land equity into the deal". Does that mean that the value of the land will cover the difference of Constructions Costs - Projected New Loan Amount (for Refi)? So if I buy the land in cash and the value of the land if high enough, I shouldn't (in theory) need any more cash to close on the loan? Just not sure if I need to plan to have cash for the land purchase as well as the construction costs that will not be financed due to the DSCR constraints.

[@jaykicks1407]

Good question ❓

[@RehabValuator]

The answer is "maybe" and that's what I show in the video here and what Rehab Valuator allows you to figure out. If the value of the land is high enough then very possibly you may not need to bring more cash into the deal to cover construction costs. But it also depends on other #s such as LTV, LTC and DCR. It really depends and that's why I am working hard to teach people how to run their own #s on their deals

[@leeroach3381]

Very helpful Thank you for sharing

[@RehabValuator]

You are very welcome!

[@ms.haqiahlee8374]

AMAZING JOB

[@RehabValuator]

Thank you!

[@TylerJones-nu9ln]

Great training video! Question, new to this so is the permanent loan amount the new sweat equity value that you can walk away with cash in hand? A bit confused on that particular process. Thanks

[@RehabValuator]

All good. Glad you're asking questions! The new perm loan amount is the maximum debt that can be supported with the project income of the property. Not the same as sweat equity and sweat equity is actually an indepent figure from financing. Sweat equity is New Value minus Total Cost of Project. So if your new building is worth $100k when it's built and it cost you a total of $80k to build it (land, soft costs, construction), then the sweat equity you create is $20k. Doesn't matter if you finance $50k or $100k. Does that make sense?

[@oe1299]

🔥 🔥🔥 Great video

[@RehabValuator]

Thanks! 😃

[@fattiejayzz]

Afternoon, one question I have is why not a 3/1 ? I'm my market an extra room brings more cash flow. It's a middle to lower class area, but I would like to build new.

[@RehabValuator]

Great question. In our area we typically don't see families or kids so 3 bedrooms just invites roommate situations with non stop turnover. But if I was building in areas with better schools, would certainly consider building 3 or even 4 bedroom units

[@jonathanwhalen1041]

thank you

[@RehabValuator]

You're welcome!

[@lindor-1luv402]

Great video Sir, very instructive, I'm a realestate investor who currently resides in Canada; but we plan on investing in the US, therefore I plan on purchasing your software. 1 Question, does your software also calculate Comps in foreign markets, example Canadian realestate market?

[@RehabValuator]

Glad you enjoyed the video. Rehab Valuator is used by investors all over Canada currently but our data (for now) is US only. We are looking into adding additional data but don't have a timeline yet

[@lindor-1luv402]

@RehabValuator Sounds good, I'm looking to use the software. On another note, have you ever been to Canada , Toronto, Mtl, Ottawa for speaking engagements? If not, do you ever plan to? We need to be exposed to more sound minded developers like you. These 10x Gurus conventions are getting overplayed...

[@RehabValuator]

@@lindor-1luv402 I hear ya about the 10x gurus. Feel your pain. I don't do a lot of speaking engagements in person with 3 young kids at home. Mostly do webinars these days. I was in Toronto last fall with my wife. Gorgeous city. But that was just for fun!

[@channel6sandiego]

Well done.....love it

[@RehabValuator]

Glad to hear it!

[@SlangScientist]

Live in Mt. Vernon, NY where it takes a year and a half to build something like this because of the building dept.

[@bvssrsguntur6338]

I am stuck at finding and buying the land with right zone

[@christianstill.6654]

When will you make the rest of the steps??🔥🔥

[@RehabValuator]

In due time :) What are you looking to learn specifically?

[@christianstill.6654]

@@RehabValuator Everything on the list and how to partner up with developers like your self and equity investors to fund getting the lots and the soft costs and down payment before I refi or cash them out with the rest of the construction loan

[@lucas-hideo]

Hi, can anybody tell how he calculated the $274,500 max loan? on 26:54 please

[@RehabValuator]

Grab a free version of Rehab Valuator and follow along with the math in the video and you'll easily see ;) www.RehabValuator.com

[@edwise8927]

i am building new single family bec duplex is not allowed without special use permits here in NJ but new counstructioun numbers still work better thane rehap. how do i find cities that do allows Duplex?

[@RehabValuator]

Why not apply for special use permits? The real $$ is made by CHANGING zoning not complying with zoning. That is the way to increase land value for yourself instead of paying the seller for existing value. Read this again and let it sink in!

[@edwise8927]

wow your really have so much value here. i did look into rezoning but i was told it could take 2-5 years sometimes to push a rezoning through due to local municipals having so much power and angry neighbors who don't like change. If there was is a way to get the engineer, attorney and architect to move faster i would love to know!@@RehabValuator

[@RehabValuator]

2-5 years sounds very long. Definitely some areas have so much NIMBY'ism that it's not worth it. Gotta pick your battles!

[@NickBivens]

He would this work if I want to build a duplex but owner occupy one side of the duplex

[@RehabValuator]

With the right numbers, absolutely!

[@meltingpotonradio]

Would financial institutions give you a construction loan based on ABV? I think they mostly use Cost.

[@RehabValuator]

They look at ABV, LTC and DCR. Usually at whichever is the lowest. These days DCR drives max leverage more than anything.