1st yr, 15+ Deals in SF Bay Area, $1.6m Profit, Ask Any Questions

16 Replies

Good Morning All,

We have officially completed our first year in business. We did about 15 deals ranging from $15k rehabs to $650k rehabs and $23k wholesales to $150k wholesales. It was about 50/50 on wholesaling and fixing and flipping. Let me start out by saying my partner and I have never made more than $100k, we live in the SF Bay Area so I think we are considered to be in poverty, just kidding but its close. Up until 2015 I was in the military and was making the big bucks. I guess I am trying to say money didn't come easily and we scraped by for the first two deals to make them happen with the caveat that if these didn't work we would lose as we went all in and it would be back to the 9-5 and saving just to hope to retire at age 65. We both have been in real estate as a side gig that made no money for some years. We each have a buy and hold and we both got our real estate license, with which we sold nothing right before the crash. So we have some experience with real estate, none with flipping except for the TV shows for which I now have no time for. 

It all started October 2016 after spinning our wheels for a good year plus with nothing happening. In that learning process we were shooting in a dark room and probably came very close to shooting ourselves a few times. In a matter of a month after that first deal the lights came on and the roller coaster took off. The first property was a single family home that we essentially wholesaled and then we turned and burned for the big stuff. The next one was a 4-plex that we flipped, full rehab and stabilized the rents. After that we did another four multi-families mixed in with single family homes. Our purchases ranged from $300k to $2m.  

One of our best moves that took us from six figure flippers to the seven figure range was networking. We attended quite a few meetups and took everything we could from the speakers and utilized it to the max. One speaker has made us $500k plus this year and will most likely make us more than a $1m in the next yr or two. There were some meetups where the speakers were OK and the benefit of that meetup was meeting all the others who were there.  

We have now started keeping the multi families and are still focusing heavily on the the single family flip. There is just no better place in the world to be in real estate than the San Francisco Bay Area. Ask your questions and I'll answer them the best I can. 

Hi Bobby,

Where are you purchasing your properties? Any particular area in the Bay? Also what meet ups are you attending?

@Bobby Nilsen congrats on the success!

You mention that networking and utilizing what the speakers said as one of your keys to growth. 

Without getting into too much detail (unless you want to), what exactly did you do to "utilize" their knowledge?

As someone just getting into real estate, it can seem very daunting at times; however, the more time we spend on here the easier it is to realize the opportunities are out there and we just have to put in the effort to make it work.

Any advice you would give to those just starting out?

Again, congratulations on your current and growing success!

@Bobby Nilsen congrats !

I am curious about the $150,000 wholesale deal and $650k rehab deals .

What did the $650,000 rehab deal look like . Purchase price , time to rehab , exit sale price.
Do you list the properties on the MLS yourself since you mentioned you are licensed ?

Do you find all your deals off market or some on the MLS ? Do you use direct mail marketing ?

How are you financing your deals ? Are you using hard money or have you built relationships with private money lenders?

@Bobby Nilsen First of all Congratulations on your success and kudos that you were able to leverage knowledge and networking to your financial success and cashflow. I live in the bay area and i want to start my first investment, however looking at the current bay area market, everything is so expensive and unaffordable. Whats your suggestion on bay area market and how do you think i can start off in this area for my first investment?

@Vince Scolari We have purchased as far south as Gilroy and as far north as Crockett. Most of our purchases are in sunnyvale, Mountain View, and San Jose. Theres a few decent meetups, the one that I go to more regularily is at Harry's Hofbrau. 

@Noah Scott The biggest piece of advice is when you know you have a deal pull the trigger. We have lost out on a few due to not getting it done quick enough. We have also tried to wholesale deals to others where I am glad they didn't pull the trigger because. We have also made a lot of money being the quickest. The golden ticket is talk to as many agents as possible to grow your network with them. The agents spend a lot of money on marketing, let them market for you. 

@Joseph M. The $150k wholesale was a duplex in Mountain View right across the street from google. There is a post about the $650k rehab which can be found here. I am no longer an agent, never did too much with the license and it just expired. But yes any deal we find on our own we will list. That $650k deal we listed ourselves and were told by many agents they will net us more. After it sold they all thought it was nuts how much we got for it. Our deals are found using everything, craigslist, real estate agents for on and off market, mailers, referrals, etc. Haven't done billboards yet, those will be soon to come I think. Financing is through hard money, have a guy we can send a text to and he will fund it from that. He knows we bring deals.  We haven't found private money that can beat our hard money guy. 

@Chaithra Kumar I have no clue where the market in the Bay Area is going. Its crazy and that's all I know. We try not to get into anything that if worst case scenario we know we cant fire sale for a profit or rent for cash flow. We also try not to go out too far for rehabs so we get in and out in  a short time. For your first property it depends on what you want to do, buy and hold or flip. 

Thanks @Bobby Nilsen . i am looking to buy and hold. preferably rental turn key properties, i guess i should start looking outside bay area market. sacramento or surrounding towns.

@Bobby Nilsen just looked at the thread about the 4plex flip , really nice . I don't hear about too many on BP flipping multifamily so that's interesting to read .

Definitely looked much much nicer after the rehab. That's awesome you broke records with the sale.

Awesome flip Bobby. I am curious where is SJ was that Quad?

Congrats on an excellent year @Bobby Nilsen ! Its always good to hear about a Bay Area investor crushing it when so many other say "there are no deals in the Bay Area". The Bay Area is indeed the best market in the country to be a real estate investor. I invested out of state (GA and TX) for over 2 years before working my back yard. Had to do like a dozen flips out there to equal one decent one here. Just no comparison. 

That's fantastic! Can you participate and speak at Jeff's event? :)

@Chaithra Kumar Depending on how hard you want to look there are still great deals in the Bay Area. What types of properties are you looking for and what kinds of return do you want?

@Joseph M. Thanks Joseph.

@Vince Scolari That 4 plex was in downtown San Jose, a couple blocks from SJSU. 

@Jeff Pollack  @Spencer Hsu Thank you Jeff for holding those meetups. I't's been beneficial for networking. See you at the next one. 

How'd you get a intro to your money guy, was it through networking/meetups?

@Matt K. Networking and ultimately it was a referral from a fellow investor. When you have a deal, finding the money or what to do with it will not be a problem, just let me know and I'll help out. Over the last year we bought a few deals that went through the wholesale underworld that many investors passed on. from those we've made over $150k. When you have something that pencils out let me know and I'll run over everything with you and help you figure out the best option for you.

@Bobby Nilsen

Itś really good to hear about someone crushing it so hard in the Bay. What meet-ups or REIAs do you recommend?

@Bobby Nilsen what form do you use to get the property in contract for wholesaling? Would you mind sharing?

@Cody Evans If you want give me a call and we can chat. @Avi Garg I have developed one from about five different ones and then it's changed after every deal. I just googled wholesale contracts and then took what I liked from each one and made it my own. I could give you one but I think a better exercise would be to develop your own. a huge thing in real estate is being able to sell yourself. Making your own contract will get you familiar with it and when you have a deal you'll have no hiccups when putting it together. It's no fun when I am buying a property and I have to correct the contract. I try to live by the motto get it right the first time everytime. Most people will be satisfied with submitting an offer and correcting it, not me.

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