J Scott - Author of Flipping/Estimating Book - Ask Me Anything!
Hey everyone!
First, thank you so much for all the support after my recent Podcast episode and the recent BiggerPockets release of the 2nd Editions of The Book on Flipping Houses and The Book on Estimating Rehab Costs. I've gotten a tremendous amount of email and private messages with the kindest of words, and I sincerely appreciate it.
Unfortunately, there's been so many emails and messages that I haven't had the ability to respond to everyone, despite my best attempts. Many of them contained questions -- and I hate not being able to respond to all the questions I get! So, I wanted to start a thread to give everyone an opportunity to ask questions -- and since I get many of the same questions over and over, I thought this might be a good resource for future questions I may get.
Anyway, if you have any questions about the Flipping/Estimating books, about any aspects of real estate strategies, about investing in general, about running a real estate business (or any business), etc., I'm happy to do my best to answer.
There are a lot of tremendously knowledgeable people on this forum, so don't post here if you have a question best answered by the whole community.
But, if you want to address something specifically towards me, this is the place! Feel free to post in this thread and I'll do my best to respond to everyone!
Also note that I created this thread a few years back -- might be worth checking first to see if I've answered it there:
@J Scott I got your books! They're very helpful!
I noticed it lists the labor for installing a new window to be $750-$1100 in the book on estimating rehab costs. I assume that must be a typo? Is it supposed to be $75-$110?
Originally posted by @Adam Moehn:
@J Scott I got your books! They're very helpful!
I noticed it lists the labor for installing a new window to be $750-$1100 in the book on estimating rehab costs. I assume that must be a typo? Is it supposed to be $75-$110?
Hey Adam!
Thanks for pointing this out... Can you tell me which version of the estimating book you're looking at (PDF, Kindle or Paperback) and what page?
I'm not able to find the error in my copy, but you're correct that it should be $110...
Thanks again!
It's in the paperback. Page 142. Here's a photo, with my written note of what I assumed it was supposed to say.
First off, your first edition of this book helped me navigate so much of the BS I normally faced when dealing with contractors in my neck of the woods. I used it as a reference manual so that I could sound "smart like" to all the contractors we used, which in turn later helped me develop many of the processes we use today.
Second, who are you more excited to hang out with in April when you come out to Seattle to visit. Me or @Dave Van Horn?
Originally posted by @Adam Moehn:
It's in the paperback. Page 142. Here's a photo, with my written note of what I assumed it was supposed to say.
Thank you, Adam!
I'll make sure this is on my edit list for the next update...
Originally posted by @Tarl Yarber:
First off, your first edition of this book helped me navigate so much of the BS I normally faced when dealing with contractors in my neck of the woods. I used it as a reference manual so that I could sound "smart like" to all the contractors we used, which in turn later helped me develop many of the processes we use today.
Second, who are you more excited to hang out with in April when you come out to Seattle to visit. Me or @Dave Van Horn?
Thanks Tarl!!!
And that's a tough question about you or Dave Van Horn. Dave is a lot more handsome than you...but he doesn't like sushi.
Is there a third option??? ;-)
Id give you a third one...but I already know who you would choose if the other option was Grace...I just didnt want to lose so quickly.
Thanks for all of your previous advice. One of your recurrent themes for all parts of the process is to personally be there at the site. We leave in Southern California. Home prices are too high for us out west here to acquire and rehab property. We do have enough liquidity to invest in markets quite far from us. Therefore, being at the site involves a high cost in terms of time and money. I am wondering if any of the following surrogates could replace my presence at the site.
- Obtaining a BPO to determine value. They are cheap and fast.
- Hiring an inspector to determine the extent of work that needs to be done. He knows what he is looking at better than I do anyway.
- Relying on the lender's loan approval to validate my value estimate and their construction disbursement systems to control the completion of work by the contractor before disbursing funds.
Originally posted by @Elizabeth A Shatzkin:
Thanks for all of your previous advice. One of your recurrent themes for all parts of the process is to personally be there at the site. We leave in Southern California. Home prices are too high for us out west here to acquire and rehab property. We do have enough liquidity to invest in markets quite far from us. Therefore, being at the site involves a high cost in terms of time and money. I am wondering if any of the following surrogates could replace my presence at the site.
- Obtaining a BPO to determine value. They are cheap and fast.
- Hiring an inspector to determine the extent of work that needs to be done. He knows what he is looking at better than I do anyway.
- Relying on the lender's loan approval to validate my value estimate and their construction disbursement systems to control the completion of work by the contractor before disbursing funds.
All three of those are a great way to help validate the deal and make sure you're not buying something that you shouldn't be buying. But, they still miss two things:
1. They won't give you a complete picture of the house, the neighborhood, the local housing market, etc. For example, this won't tell you if the neighbor has a giant trash heap in his yard that would make it difficult to resell the property. If you want to cover this gap, this is where having a great real estate agent can be worthwhile. The agent can validate that it's a neighborhood where you should be buying, where you can resell for your target ARV, that there are no issues that would be hard to identify without being on site.
2. The most important reason to be on site is to manage the contractors and ensure that the rehab is coming along as planned, on budget and at the level of quality you expect. This can be mitigated by having a local project manager whose job it is to visit the site everyday (or close to every day) and who can stay on top of the contractors until the project is complete. This can also be a real estate agent who is familiar with the renovation process, and might even be the same agent as you use for #1 above.
Long story short, if you can't be there personally, you need to ensure that there is someone who has a holistic view of the project on-the-ground and looking out for your best interests on an almost daily basis (and this shouldn't be the contractor).
Thank you for your offer. Again, we ask your help. We are just not getting the concept of so many people that suggest one can be overwhelmed with good deals while seated at one's own desk simply by launching effective marketing. Despite the varied information available online, if a property is located just a half mile, this way or that, an ARV estimate can be off by tens of thousands of dollars. As can the repair estimate be off by a like amount without physically inspecting the property. How do these guys do it from their desk without themselves losing 000's as an investor, or doing an injustice to one's clients as a wholesaler. We are trying to do business from out of state because our market is priced way too high for us. The going is arduous. Developing a team on the ground painstaking.
Originally posted by @Elizabeth A Shatzkin:Thank you for your offer. Again, we ask your help. We are just not getting the concept of so many people that suggest one can be overwhelmed with good deals while seated at one's own desk simply by launching effective marketing. Despite the varied information available online, if a property is located just a half mile, this way or that, an ARV estimate can be off by tens of thousands of dollars. As can the repair estimate be off by a like amount without physically inspecting the property. How do these guys do it from their desk without themselves losing 000's as an investor, or doing an injustice to one's clients as a wholesaler. We are trying to do business from out of state because our market is priced way too high for us. The going is arduous. Developing a team on the ground painstaking.
In my opinion, you can't be effective as a flipper if you don't physically see the property (or have someone on your team do it) and don't know the area tremendously well (or hire someone who does).
If someone tells you otherwise, you should be skeptical.
@J Scott I'm currently working through your book on flipping. I was going to start trying some direct mail for leads. I was putting together a list of absentee owners, but i'm wondering the value of in-state absentees? I feel that I will be paying for a list of other investors in the area who aren't going to be motivated sellers.
Other than absentee owners and driving for dollars, how do you put together a good list of potential sellers?
Thank you for being a mentor to the entire biggerpockets community!
Hi J,I’m reading your book, “the book on flipping houses” and had some questions about marketing as you mentioned websites, etc, in one of those chapters.
I currently have a handyman website, but want to convert it to use wording that conveys I want to buy distressed houses. While I know I probably don’t want to say “I want to buy run-down houses,” how should a site look and feel?
Do you have examples of investor websites you can send me, that are professional and convey to homeowners I can “solve their problems” as you say?
Along those lines, instagram and other social media campaigns that can drive traffic to that great site?
Thanks a bunch,Vr,Kevin Nichols, Tennessee
Quote from @Kevin Nichols:
Hi J,I’m reading your book, “the book on flipping houses” and had some questions about marketing as you mentioned websites, etc, in one of those chapters.
I currently have a handyman website, but want to convert it to use wording that conveys I want to buy distressed houses. While I know I probably don’t want to say “I want to buy run-down houses,” how should a site look and feel?
Do you have examples of investor websites you can send me, that are professional and convey to homeowners I can “solve their problems” as you say?
Along those lines, instagram and other social media campaigns that can drive traffic to that great site?
Thanks a bunch,Vr,Kevin Nichols, Tennessee
I hate to be the kid that shouts the answer in class when I wasn't asked but I couldn't resist. There are certainly large wholesaler companies in your area that have nice professional websites that will show you exactly what you are looking for. Quick google search in your area will pull up tons of them.
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Real Estate Agent
- New Western
Hi J, in "Flipping Houses" series, you emphasizes the importance of accurate rehab cost estimation for successful fix-and-flips. How can these cost-estimation principles be leveraged to create a more robust financial model for long-term rental property investments, considering factors like ongoing maintenance, capital expenditures, and market fluctuations over time?
really appreciate you taking the time to answer as many forum questions as you can!