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Jamel Gibbs
In today's real estate market people everywhere are wondering if the house flipping market is going to the dumps. I mean C'mon they are talking about it everywhere. Well, I have some news for you. Now is the time to get in on the house flipping business. Don't listen to the news and everyone else that don't know the first thing about real estate. Don't follow those "wanna be" investors that started flipping houses when things were good. Now they are running away because they think they will lose their shirt. You have to separate yourself from the crowd
Find the deal: First and foremost, you need to find the property. You can do this by placing an ad in the newspaper, working with realtors, sending out postcards, etc. I think that all three of the methods combined will get you the best results. Once you get the calls in, you must screen the sellers to make sure you find the right deal for yourself.
Make the offer: When making your offer try to present an offer that will be good for you as well as the seller. Remember that you are not there to get over on the seller, but you are there to help them get out of their situation. Make sure you can get the property at a 50 percent discount and you will have a good deal.
Get the money: Now that you have made an offer, you will need to get the funds to buy the property. Try to locate a hard money lender or a private money lender that will help you buy this property. You can find hard money lenders by doing a Google search.
Find the contractors: So you have bought the property and now you need a contractor. Try to get subcontractors to work for you. You can find these subcontractors by driving around areas where there is a lot of rehabbing going on. You may see some of the sub contractors working. Just go and talk to them and see if they are willing to work for you.
Sell the house: Now here is the tricky part! If you want to sell the property in lightning speed, then make sure the contractor has done a great rehab job. Once you have that part out of the way you will put your property up for sale. The trick is to offer the nicest house in the area for the cheapest price. Find out what other properties are up on the market for and come up with a price that is less than those homes. Then you will sell the property quick.
Along with wholesaling this is what I do! So I know what you are talking about. However I would say that now, more than ever is the time to buy and hold if you can.
I also would say that 50% off is not what to offer across the board. You need to look at each deal and run the numbers. Is that 50% after repair/remodel costs? 65% of ARV minus repairs is a good starting point on making offers that will be accepted 1 out of 25 times. Just what I see working where I am at anyway.
Flipping will make you rich
Buy And Hold will make you wealthy
Michael Mangham
MD Home Acquisitions LLC
Knowledge is power, but execution trumps knowledge. Tony Robbins
http://www.mdhomeacquisitions.com Seller site
http://www.mdhomeacquisitionsbargainhouses.com Buyer site
http://www.mdhomeacquisitionshousehunter.com Bird Dog Site
http://www.mdlodeals.com Tenant/Buyer site
I completely agree with the posts above. Making offers is so important to do with the ratio of 1:25. Offers Accepted:Offers Made. This is actually the ratio that you WANT to have. If you are getting 20:25 offers accepted, then you are making your offers too high. Conversely, if you make offers at a 1:100 ratio then you are offering way to little for the properties. 1:25 is a good "sweetspot" where you will be getting properties at the right price to make good money on the deal. Another point, I do not like the term "LOW BALL OFFER". This is a term that gives investors, and this business a bad name or a black eye. Rather than saying I make low ball offers, I like to say that I make "Aggressive Calculated" offers. This term shows what our intentions are, but it also shows that we are serious about making offers that are calculated offers with a purpose. Agents like working with people who are calculated, not just "throwing offers" out there".
Hope this little tid-bit helps.
Happy Investing!
Matt W.
I would have to definately agree that now is the time to flip. I am working on a flip with a partner that will yield a pretty nice return
Lenee
www.allstarhouses.com
~Act successful! And you'll draw it to you.~
~Every achievement, big or small, begins in your mind. It starts as a thought.~
I like the words you use 'aggressive calculated offers' instead of 'low ball offers'; after all, if we are doing our due diligence the deal will benefit everyone!
Learning and progressing every day,
Valerie
Valerie
“And will you succeed? Yes indeed, yes indeed! Ninety-eight and three-quarters percent guaranteed!” ― Dr. Seuss
"I believe in angels, the kind that heaven sends; I am surrounded by angels, but I call them friends" - Unknown
My journal: http://www.deangraziosi.com/real-estate-forums/investing-journals/59110/...