OK. So I know I'm a newbie, but I need to vent a little.
Uh-oh ... I can already see the eye rolls ... so before you look away let me just say I'm not giving up, I'm just frustrated and looking for some advice from those that have been there.
I've done all the work and setup for starting my first flip project. Got financing in place with a hard-money lender, hooked up with a bunch of wholesalers, realtors, contractors, escrow and insurance. I check and analyse properties every evening after my current day-job and early morning before I go in. I get to an accurate ARV and max offer right away and I put in offers usually same day or next if I have to see it first. I go after the deals quickly and generally try to come in at 100% of the asking price or very close to it. I haven't ever put in offers lower than 90% of asking and often will offer more than asking if that's my best price for the deal. At this point I'm making about 1 offer every other day and I'm sure my realtor is ready start blocking my calls. (no JK - he's awesome)
But it's the southern California Market!
So one after another, each property gets snatched up by someone else. First you get the "best & highest" request which is pointless cause I already went in with my best offer. Then either the seller goes with a higher offer than ours, or there were 25 other cash offers above asking (and seriously I'm not over-exaggerating here, I just got that reply from a listing agent yesterday on an offer we put in for a fixer in Chino Hills).
WHAT THE HELL MAN !?!?!???!
I keep looking and making offers every day. And there's plenty of great deals out there. I can find them quickly but how is a newbie like me to compete with the ridiculously high cash offers being thrown down by more experienced investors?
I desperately want to lock in a project before the end of 2017. But I'm starting to run out of steam.
And I really want to try to make a business out of real estate investing with the hopes that it can replace my current income. But now I'm starting to doubt how realistic that is in the southern California market where it it THIS hard to purchase a good deal.
How do you keep going without getting discouraged?
@Monica George Keep going, but maybe not in that market! When the market crashed, we relocated to so Cal, knowing it was always the first place to pick up and take off. Unfortunately, with all the HGTV shows, etc. EVERYONE is a flipper, and so cal has an abundance of people with a lot of ready cash to invest; and more often than not, they bid prices up over market value, thinking that because it's a fixer, there's money to be made.
We gave up on doing fix and flips right away, and spent the next few years doing new construction. However; building land that can be picked up for a price to realistically build, then get through the planning process was a tough one.
We relocated to Oregon, Sunriver/Bend area. There are opportunities here. It takes a matter of 4-6 weeks to get permits. The drawback is winter weather. However; no sales tax is really nice too. There's Fix/flips, VR, Buy/hold, and new construction opportunities here. Facebook and Apple have big data centers going in, and there's a huge mix of people. Of course there's a lot of people in this market, and more everyday, so it's important to know people.
I love so cal, and when you can find the "right" deal, it's a blast. But, it's a tough market, and CA is getting harder to develop in, especially in the coastal areas.
You might want to reach out to @aaron mazzrillo I know he does a lot of business in your area. I know he wholesales properties as well.
Thanks for your replies. I hung in there and just kept cranking out the offers and we finally got an accepted offer for a fixer in Cathedral City, CA. Totally excited and a little terrified at the same time. And I was able to meet my goal of closing on our first property by the end of the year. Excellent ...It's all happening! :)
Free eBook from BiggerPockets!
Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!
- Actionable advice for getting started,
- Discover the 10 Most Lucrative Real Estate Niches,
- Learn how to get started with or without money,
- Explore Real-Life Strategies for Building Wealth,
- And a LOT more.
Sign up below to download the eBook for FREE today!
We hate spam just as much as you
Join the Largest Real Estate Investing Community
Basic membership is free, forever.