First flip is the hardest?
Two Years ago I started a flip company with a contractor. We searched and searched for potential properties with no luck. I stumbled upon my first off market offer from what I didn't know at the time was a wholesaler. I thought I hit a gold mine with these off market super secret deals... only problem, they weren't deals at all. Every property we looked at had unreasonable ARVs and comps. We became so discouraged, we just quit without getting one flip.
Ive decided this time is different.
I know understand that there are tons and tons of wholesalers and you have to sift through a hundred deals to find one.. is there a better way? If this is they way, how many lists should I subscribe to in order to hope to find enough deals to flip three houses by year end?
Quote from @Brian Bisdorf:I think it depends on where you are looking. I currently have a 4/2 with pool in Phoenix AZ near Grand Canyon Univ ready to assign to someone for a fix & flip or buy and hold. Mostly just junk removal and kitchen update. ARV is about $350k and I'd assign it for $255k. And, it's easy to tell if the value if there. I'm already knee deep in a flip in North Phoenix and a couple of other projects and can't add this to my plate right now, so I'm assigning it. See how easy it is to find a great deal? But wait, there's more, you have to contact me to get the info. ;-)
Two Years ago I started a flip company with a contractor. We searched and searched for potential properties with no luck. I stumbled upon my first off market offer from what I didn't know at the time was a wholesaler. I thought I hit a gold mine with these off market super secret deals... only problem, they weren't deals at all. Every property we looked at had unreasonable ARVs and comps. We became so discouraged, we just quit without getting one flip.
Ive decided this time is different.
I know understand that there are tons and tons of wholesalers and you have to sift through a hundred deals to find one.. is there a better way? If this is they way, how many lists should I subscribe to in order to hope to find enough deals to flip three houses by year end?
#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
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#3 BRRRR - Buy, Rehab, Rent, Refinance, Repeat Contributor
- Investor
- Austin, TX
You’re only as good as your data, you can break down your KPI’s depending on what list you pull to see who the top performers are. Where you want to be is less contacts per lead.
@Brian Bisdorf where to begin? Yes, there is definitely a better way. I'm sorry you had a bad experience. I commend you for getting back out there.
First, you have to be a market expert. Never, ever rely on a wholesaler, seller or realtor to tell you what the value is. You learn the values of your market by obsessing about every property that comes on the market.
Second, don't try to reinvent the wheel. I've posted several times about this but you need to limit your obsession to a particular farm area. Your farm area is where you would buy. Usually, it's not more than 30-60 minutes from where you live. And if you are flipping, it's usually an entry level area (but not always. - again you decide). Go to open houses, walk, bike, skip and drive through neighborhoods in your farm area. What condition are the houses that sell? Are quartz countertops prevalent? LTV or hardwood? What about finished outdoor space? Are there homes that look abandoned or distressed IE are the weeds waist high? Is there a FSBO sign in the yard?
Third, go to your local REIA and meet flippers actually working in your area. Offer to take them to lunch or coffee (or whatever they are into). Maybe offer to haul junk or mow the lawn - anything that would add value to their business. If you lead with helping, you will receive help when you need it. :)
So here is our secret we are friends with other guys who flip and we help each other out. They have sent deals our way when they had plenty and vise versa. This might not work for everyone but it works well for us.
I think it's not a question of how many lists to subscribe to or anything like that. It's finding a really good wholesaler or agent. One person who knows what they're doing can find you 3 good flip opportunities by the end of the year no problem.
As mortgage brokers many of our rehab. lending buyer's come from sharp wholesalers. Some people just have the gift to find and sign deals. Hook up with one and then go for the ride. Good luck and keep moving forward.
@Brian Bisdorf I completely understand the frustration. My advice to you is network, network, network! @Carlton B. has the right idea.
Also, consider doing your own marketing! You'd be surprised how successful you can be when you cut out all of the competition!
It's just a numbers game. Make enough offers and you'll get a deal. If you made 200 offers on properties that need fixing up I think it would be unreasonable to not get one under contract (As long as your expectations for your market are not unrealistic)
It's taking me upwards of 30 offers to get an accepted offer in Phoenix right now. But I am getting them
Have faith in the process, plenty of people are out there flipping in your market every day