New investor looking to fix and flip in Socal area

New investor looking to fix and flip in Socal area

Van Nuys, CA · Member since 2017 · 29 posts · 13 votes

Hello everyone, my name is Jonathan Yip. I'm a recent MBA grad in the Los Angeles area, coming from a background in business development, digital marketing, and brand strategy, looking to go into real estate investing full time. I've owned and managed a 4-unit property for a few years, and now I'd like to get started in fix and flip properties. I am extremely handy and do a lot of home improvement projects as a hobby - building furniture, installing fixtures/appliances, fixing things - so I'm willing to work with contractors as well as invest a lot of sweat equity into a property. I'm looking into areas like the San Fernando Valley, Lancaster, Palmdale, Bakersfield, and Fresno, since LA is a little out of my price range at the moment (not ready to get another mortgage yet... I want to stick with cash for my first flip, get my feet wet, and then expand into larger deals as I get the experience). I'm definitely open to any advice, suggestions, agent referrals, etc.

Hope to learn a lot from you all. Cheers!

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Investor · Bakersfield, CA · Member since 2013 · 146 posts · 93 votes
9y

Hi @Jonathan Yip. If you are going full time, I would not plan to work with contractors and invest sweat equity. You may increase the margin on the first flip but you'll waste precious time when you should be trying to find the next deal. Focus all your energy on finding deals. Once you get one, let the contractors run the rehab and you focus on finding the next deal using your marketing background. It's all about deal flow. Every problem gets solved with good deal flow. 

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  • Investor · Bakersfield, CA · Member since 2013 · 146 posts · 93 votes
    9y

    Hi @Jonathan Yip. If you are going full time, I would not plan to work with contractors and invest sweat equity. You may increase the margin on the first flip but you'll waste precious time when you should be trying to find the next deal. Focus all your energy on finding deals. Once you get one, let the contractors run the rehab and you focus on finding the next deal using your marketing background. It's all about deal flow. Every problem gets solved with good deal flow. 

  • Real Estate Agent · Los Angeles, CA · Member since 2017 · 120 posts · 36 votes
    9y
    Welcome Jonathan Yip LA is definitely a difficult area to fix and flip. You might also think about looking south and east of LA (Hawthorne, South LA, Cypress, Pomona), and keep your eyes peeled for the occasional deal that pops up in LA. Palmdale seems to be discussed a lot on here as the next potential area to grow but not sure what the returns are there. Good luck! Let me know if I can be of any help on your search.
  • Commercial Real Estate Broker · Los Angeles, CA · Member since 2013 · 35 posts · 6 votes
    9y

    @Jonathan Yip, I just started doing a fix and flips out here in SoCal as well. I found a cheap home in Adelanto to start with. Did a hard money loan. I found it through a group called New Western. They don't always have the best reputation, but if the numbers make sense, who cares. I think there is very little meat on this bone that I just bought but it was the cheapest thing I could afford just starting out. Fingers crossed I can make this work. Keep in touch. I would love to heat  about different things that are working for you and ill do you the same courtesy. 

  • Investor · Bakersfield, CA · Member since 2015 · 483 posts · 234 votes
    9y
    Hi Jonathan Yip glad to hear you are getting into investing. I would love to chat further to see if we can work together as I am looking to get into the fix and flip market as well. I am interested in your background and would like to discuss further. Feel free to PM me.
  • Van Nuys, CA · Member since 2017 · 29 posts · 13 votes
    9y

    Thank you all for the welcome and the advice. Out of the areas that have been mentioned (Bakersfield, Lancaster, Palmdale, Fresno, East/South LA, etc), does anyone have any input on the overall housing/job markets?

    Once I've settled on an area to focus on, what would you recommend as the best way to find a flip-friendly agent and start checking out properties?

    I'm working with a limited budget - just enough for a low-priced cash deal + remodel, which is why I mention the sweat equity. For now, I won't have anything left for new deals until I close out the first one. I'm willing to put in the time for my first deal for the experience, then eventually work up into bigger deals where I can outsource more and more of the work.

    Thanks again for all your feedback!

  • Wholesaler · Culver City, CA · Member since 2015 · 185 posts · 56 votes
    9y
    Hey Jonathan Yip , I can only speak for The AV; as that is my target area. It seems to be picking up a little bit. I’m noticing sales prices jump quite a bit in the last year. A deal I wholesaled just resold for $30k more than I expected. Unfortunate for me, I’m not getting much lead flow from that area; as much as I mail to that area. But someone is snatching up properties out there.
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