Atlanta, GA · Member since 2021 · 163 posts · 57 votes
I have been flipping properties for 2-3 years and have done a fair amount of deals. All profitable
I have 7 houses for sale right now and having some trouble selling them with this market slowdown
Meanwhile, I have been trying to find another deal for the past several months. I’ve probably looked at 200-300+ deals (wholesaler deals, agent deal, on market, etc) and all of them either lose money or break even. It seems as if the market has dropped, but only on the sell side, not the acquisition side. I’m not trying to be greedy and ask too much on discounts for the flips, I am literally just trying to find something profitable
My question is…. Is everybody else having this same problem? Am I in too competitive of a market (Atlanta, GA) bc there are actually people still buying these deals and ridiculous prices? Do I just not have the right people in my network?
Real Estate Investor · Middle TN and Southern KY · Member since 2014 · 71 posts · 26 votes
2y
I'm on the verge of completely giving up!! I can't retire, refuse to work for someone else, but I do have cash built up (Thank GOD), and a 850 Fico across all the Credit Bureaus. The reason I don't have more cash is thanks to a former business partner and 5 years of litigation. I got back a drop in the bucket and have been trying to rebuild ever since. Hence why I say, "the only ship that don't float, is a partnership!!"
I need flips IN VOLUME to build cash and have money to live on. Rentals can't do that!!!
I quit building last year (slow market/high rates) and have been trying to find a flip for quite some time as they seem to move rather quickly on the market surprisingly. All I come up with are so called "wholesalers" with not even a marginal deal. Back in the day when I started flipping 18 years ago it was 70% of ARV minus repairs minus wholesale fee. These wholesalers TODAY are either clueless on rehab cost, real ARV and/or people are actually overpaying, which I have seen that quite often on MLS. (I have TN re license)
Example: A Realtor (roll on floor laugh my butt off) paid $180,000 for a house last year that might go for $250 ARV today! 5 months and at least $40k minimum later she list it at $265k (still laughing) it closes at $245K cause it wouldn't appraise! It's not a Christian thing to say but I hope that all these people out here not following the 70% rule, or people overpaying for rehabs choke on it!
I have been hopeful in finding a deal out of state as I have a Realtor in that area that believes I can find the on market deals i'm looking for. Problem is finding a investor friendly GC in that area. I've spoke to 1 I like so far but Would like to have others on my team as well. I'm kinda doubtful in finding on market deals there though and don't want to waste the Realtors time even though he thinks it can be done.
The internet, gurus-advertising constantly in reels feeds, and TV shows has killed this industry.
Now useless NAR settled in that dumb lawsuit that they should have never lost and that's just going to add to more problems in the real estate market. If it ain't broke, DON'T FIX IT!! All the buttholes suing and their copycat suits are basically suing McDonalds for hot coffee!!! This is going to add to more trouble in the markets.
I don't see how I can make it any longer, I keep asking God to open a door for me.
Meanwhile, I keep practicing "Welcome to McDonalds, may I take your order please!"
Real Estate Agent · Miami, FL · Member since 2019 · 25 posts · 19 votes
2y
Hey Steven, I've done a handful of flips in greater ATL but mostly focus on Florida. Regardless, many seem to be in the same boat. It seems to be a combination of wholesale becoming more popular (and competitive so upwards pricing pressure) and with more investors in the market, wholesalers are stretching deals to maximize profit. With so many investor buyers, even bad deals get sold now (to your point). Many that I've talked to are now working their own acquisition strategies using call centers, etc. to take cold and warm lists to hotter and then focusing more time speaking directly with potential motivated sellers from those hot lists, rather than using a wholesaler (or any other middle man) to source deals. Adds more layers of work and complexity, but I'm noticing the trend. Maybe something to consider for you rather than just getting on more wholesalers lists... I've also seen more and more of my flip network trying to source deals directly via creative finance.
Realtor · Atlanta, GA · Member since 2021 · 239 posts · 120 votes
2y
@Steven Barr I totally get your struggle, finding a good deal in this current Atlanta market is like searching for a needle in a haystack. It's the Wild West right now. Have you checked out any other areas, like Gwinnett or even West Cobb, where there might be less competition but still potential for profitable deals? It might be worth a shot to mix things up a bit and look outside of the city to find those profitable deals.
Real Estate Agent · Atlanta, GA · Member since 2024 · 4 posts · 4 votes
2y
I am experiencing the same thing in Atlanta. The houses that need a lot of work are far overpriced to make a good profit. I'm not sure why these houses are ridiculously priced.
I have been flipping properties for 2-3 years and have done a fair amount of deals. All profitable
I have 7 houses for sale right now and having some trouble selling them with this market slowdown
Meanwhile, I have been trying to find another deal for the past several months. I’ve probably looked at 200-300+ deals (wholesaler deals, agent deal, on market, etc) and all of them either lose money or break even. It seems as if the market has dropped, but only on the sell side, not the acquisition side. I’m not trying to be greedy and ask too much on discounts for the flips, I am literally just trying to find something profitable
My question is…. Is everybody else having this same problem? Am I in too competitive of a market (Atlanta, GA) bc there are actually people still buying these deals and ridiculous prices? Do I just not have the right people in my network?
Thanks for the insight!
Definitely a needle in the haystack thing here too. A couple of things I've noticed is people are "staying put" for lack of better wording. Another is turn key buy n hold investors are re-entering the flipping environment. Value add is going to be a strong play in the REI world. BRRRR folks are not appreciating the higher interest rates as well. Fingers crossed for you.
Real Estate Investor · Middle TN and Southern KY · Member since 2014 · 71 posts · 26 votes
2y
I'm on the verge of completely giving up!! I can't retire, refuse to work for someone else, but I do have cash built up (Thank GOD), and a 850 Fico across all the Credit Bureaus. The reason I don't have more cash is thanks to a former business partner and 5 years of litigation. I got back a drop in the bucket and have been trying to rebuild ever since. Hence why I say, "the only ship that don't float, is a partnership!!"
I need flips IN VOLUME to build cash and have money to live on. Rentals can't do that!!!
I quit building last year (slow market/high rates) and have been trying to find a flip for quite some time as they seem to move rather quickly on the market surprisingly. All I come up with are so called "wholesalers" with not even a marginal deal. Back in the day when I started flipping 18 years ago it was 70% of ARV minus repairs minus wholesale fee. These wholesalers TODAY are either clueless on rehab cost, real ARV and/or people are actually overpaying, which I have seen that quite often on MLS. (I have TN re license)
Example: A Realtor (roll on floor laugh my butt off) paid $180,000 for a house last year that might go for $250 ARV today! 5 months and at least $40k minimum later she list it at $265k (still laughing) it closes at $245K cause it wouldn't appraise! It's not a Christian thing to say but I hope that all these people out here not following the 70% rule, or people overpaying for rehabs choke on it!
I have been hopeful in finding a deal out of state as I have a Realtor in that area that believes I can find the on market deals i'm looking for. Problem is finding a investor friendly GC in that area. I've spoke to 1 I like so far but Would like to have others on my team as well. I'm kinda doubtful in finding on market deals there though and don't want to waste the Realtors time even though he thinks it can be done.
The internet, gurus-advertising constantly in reels feeds, and TV shows has killed this industry.
Now useless NAR settled in that dumb lawsuit that they should have never lost and that's just going to add to more problems in the real estate market. If it ain't broke, DON'T FIX IT!! All the buttholes suing and their copycat suits are basically suing McDonalds for hot coffee!!! This is going to add to more trouble in the markets.
I don't see how I can make it any longer, I keep asking God to open a door for me.
Meanwhile, I keep practicing "Welcome to McDonalds, may I take your order please!"
Developer · Member since 2020 · 4k+ posts · 4k+ votes
2y
OP
Look where others aren’t.
Get on loopnet, crexi, commercial. Look for churches, daycare, elementary schools, dental offices, etc that can be converted to housing.
My buddy has done two older school buildings and fills them up. Hardest part is sewer and water. But once you have the layout done, it’s just busting concrete.
Real Estate Agent · Columbus & Cleveland, OH · Member since 2023 · 1k+ posts · 1k+ votes
2y
If your willing to look out-of-state, there are some great opportunities in the Ohio markets. Many investors from markets where numbers aren't penciling, are choosing to invest in the midwest because of the yearly returns making more sense in these lower priced markets. Ohio markets show up 3 times in Zillow's 2024 hottest markets, with Columbus and Cincinnati taking the top 2 and 3 spots. I moved from Florida to start investing in Columbus due to this same reason.
Get on loopnet, crexi, commercial. Look for churches, daycare, elementary schools, dental offices, etc that can be converted to housing.
My buddy has done two older school buildings and fills them up. Hardest part is sewer and water. But once you have the layout done, it’s just busting concrete.
He holds and rents, but could also sell.
Thank you for the idea. I'm sure it won't be long before the market is saturated with people doing that. Holding wouldn't be helpful as I need to build more cash, but it's worth checking out.
If your willing to look out-of-state, there are some great opportunities in the Ohio markets. Many investors from markets where numbers aren't penciling, are choosing to invest in the midwest because of the yearly returns making more sense in these lower priced markets. Ohio markets show up 3 times in Zillow's 2024 hottest markets, with Columbus and Cincinnati taking the top 2 and 3 spots. I moved from Florida to start investing in Columbus due to this same reason.
I've considered Ohio, heard Cleveland was strong but not clear if for just rentals or true flip meaning rehab and resell. I need to build more cash. Rentals can't do that but flips do.
You said you moved from Florida, lol Miami is where I want to be!
What are you looking to make on a fix and flip? How many properties are you typically underwriting on a given day?
If you can't make a minimum of $45 grand on a deal, it's not worth it!!! I can/could easily make that off a new spec house and more. Unless you are turning in volume 10-15 or more houses a year. I could turn 15 plus rehabs a year! But i've been struggling for almost a year to get 1 deal! $10-$20 grand on a deal is pathetic and not worth my time! Heck, you gotta pay taxes on it too, and you also run the risk of the unforeseen and problems along the way with a rehab.
Lets see, I paid my fees and got back on MLS last May, and signed up for Privy. Did nothing for 3 months straight but sit at this computer looking at potential on market deals and crunching numbers!
Now I just call or text agents and say hey, I'm a flipper, before I spend time and travel to go look at this listing, how flexible are your sellers? It's not worth the 1/2 hour to hour trip (one way) to go look at a potential deal, then crunching numbers, then spend another hour on all the paperwork required to submit an offer in writing on a MLS deal.
I also used Jerry Nortons "Flipster" last year for the free trial period! What a joke! If you are wanting to take the time and expense to mail people, I'd spend DAYS scrubbing list of people to mail to. If they haven't owned the house for 15-20 years (with a mortgage) then they aren't gonna have enough equity for you to buy it as a flipper. So i couldn't depend on Flipster, and the comps for on market properties or even an off market address I ran through Flipster was WAY-OFF. Nothing beats MLS and training from a broker who'd been in the business 20 years, and partial training from an appraiser, and this was 22 years ago. I had to school a so called wholesaler last week on his comps, lol!
I also tried Property Radar for a trial period in this time as well. Nope.
I stopped doing mailers, cold calls, etc back in 2007 and relied on MLS. I always got my deals and best deals from MLS or wholesalers who used the proven formula of 70% of ARV MINUS REPAIRS MINUS WHOLESALE FEE.
I found out the hard-way my 1st year that 10s of thousands of dollars or all the time out of my life trying to save money and do it myself was not worth it to maybe get 1 deal trying to buy direct from owners.
What are you looking to make on a fix and flip? How many properties are you typically underwriting on a given day?
If you can't make a minimum of $45 grand on a deal, it's not worth it!!! I can/could easily make that off a new spec house and more. Unless you are turning in volume 10-15 or more houses a year. I could turn 15 plus rehabs a year! But i've been struggling for almost a year to get 1 deal! $10-$20 grand on a deal is pathetic and not worth my time! Heck, you gotta pay taxes on it too, and you also run the risk of the unforeseen and problems along the way with a rehab.
Lets see, I paid my fees and got back on MLS last May, and signed up for Privy. Did nothing for 3 months straight but sit at this computer looking at potential on market deals and crunching numbers!
Now I just call or text agents and say hey, I'm a flipper, before I spend time and travel to go look at this listing, how flexible are your sellers? It's not worth the 1/2 hour to hour trip (one way) to go look at a potential deal, then crunching numbers, then spend another hour on all the paperwork required to submit an offer in writing on a MLS deal.
I also used Jerry Nortons "Flipster" last year for the free trial period! What a joke! If you are wanting to take the time and expense to mail people, I'd spend DAYS scrubbing list of people to mail to. If they haven't owned the house for 15-20 years (with a mortgage) then they aren't gonna have enough equity for you to buy it as a flipper. So i couldn't depend on Flipster, and the comps for on market properties or even an off market address I ran through Flipster was WAY-OFF. Nothing beats MLS and training from a broker who'd been in the business 20 years, and partial training from an appraiser, and this was 22 years ago. I had to school a so called wholesaler last week on his comps, lol!
I also tried Property Radar for a trial period in this time as well. Nope.
I stopped doing mailers, cold calls, etc back in 2007 and relied on MLS. I always got my deals and best deals from MLS or wholesalers who used the proven formula of 70% of ARV MINUS REPAIRS MINUS WHOLESALE FEE.
I found out the hard-way my 1st year that 10s of thousands of dollars or all the time out of my life trying to save money and do it myself was not worth it to maybe get 1 deal trying to buy direct from owners.
Best of luck to ya :)
@Ronnie C. why were you unable to turn 15 specs in a year? Or am I misunderstanding?
What are you looking to make on a fix and flip? How many properties are you typically underwriting on a given day?
If you can't make a minimum of $45 grand on a deal, it's not worth it!!! I can/could easily make that off a new spec house and more. Unless you are turning in volume 10-15 or more houses a year. I could turn 15 plus rehabs a year! But i've been struggling for almost a year to get 1 deal! $10-$20 grand on a deal is pathetic and not worth my time! Heck, you gotta pay taxes on it too, and you also run the risk of the unforeseen and problems along the way with a rehab.
Lets see, I paid my fees and got back on MLS last May, and signed up for Privy. Did nothing for 3 months straight but sit at this computer looking at potential on market deals and crunching numbers!
Now I just call or text agents and say hey, I'm a flipper, before I spend time and travel to go look at this listing, how flexible are your sellers? It's not worth the 1/2 hour to hour trip (one way) to go look at a potential deal, then crunching numbers, then spend another hour on all the paperwork required to submit an offer in writing on a MLS deal.
I also used Jerry Nortons "Flipster" last year for the free trial period! What a joke! If you are wanting to take the time and expense to mail people, I'd spend DAYS scrubbing list of people to mail to. If they haven't owned the house for 15-20 years (with a mortgage) then they aren't gonna have enough equity for you to buy it as a flipper. So i couldn't depend on Flipster, and the comps for on market properties or even an off market address I ran through Flipster was WAY-OFF. Nothing beats MLS and training from a broker who'd been in the business 20 years, and partial training from an appraiser, and this was 22 years ago. I had to school a so called wholesaler last week on his comps, lol!
I also tried Property Radar for a trial period in this time as well. Nope.
I stopped doing mailers, cold calls, etc back in 2007 and relied on MLS. I always got my deals and best deals from MLS or wholesalers who used the proven formula of 70% of ARV MINUS REPAIRS MINUS WHOLESALE FEE.
I found out the hard-way my 1st year that 10s of thousands of dollars or all the time out of my life trying to save money and do it myself was not worth it to maybe get 1 deal trying to buy direct from owners.
Best of luck to ya :)
@Ronnie C. why were you unable to turn 15 specs in a year? Or am I misunderstanding?
You misunderstood :). I AM able to turn more than 15 rehabs a year, "IF" I could find the deals! I haven't been able to find a deal.
What are you looking to make on a fix and flip? How many properties are you typically underwriting on a given day?
If you can't make a minimum of $45 grand on a deal, it's not worth it!!! I can/could easily make that off a new spec house and more. Unless you are turning in volume 10-15 or more houses a year. I could turn 15 plus rehabs a year! But i've been struggling for almost a year to get 1 deal! $10-$20 grand on a deal is pathetic and not worth my time! Heck, you gotta pay taxes on it too, and you also run the risk of the unforeseen and problems along the way with a rehab.
Lets see, I paid my fees and got back on MLS last May, and signed up for Privy. Did nothing for 3 months straight but sit at this computer looking at potential on market deals and crunching numbers!
Now I just call or text agents and say hey, I'm a flipper, before I spend time and travel to go look at this listing, how flexible are your sellers? It's not worth the 1/2 hour to hour trip (one way) to go look at a potential deal, then crunching numbers, then spend another hour on all the paperwork required to submit an offer in writing on a MLS deal.
I also used Jerry Nortons "Flipster" last year for the free trial period! What a joke! If you are wanting to take the time and expense to mail people, I'd spend DAYS scrubbing list of people to mail to. If they haven't owned the house for 15-20 years (with a mortgage) then they aren't gonna have enough equity for you to buy it as a flipper. So i couldn't depend on Flipster, and the comps for on market properties or even an off market address I ran through Flipster was WAY-OFF. Nothing beats MLS and training from a broker who'd been in the business 20 years, and partial training from an appraiser, and this was 22 years ago. I had to school a so called wholesaler last week on his comps, lol!
I also tried Property Radar for a trial period in this time as well. Nope.
I stopped doing mailers, cold calls, etc back in 2007 and relied on MLS. I always got my deals and best deals from MLS or wholesalers who used the proven formula of 70% of ARV MINUS REPAIRS MINUS WHOLESALE FEE.
I found out the hard-way my 1st year that 10s of thousands of dollars or all the time out of my life trying to save money and do it myself was not worth it to maybe get 1 deal trying to buy direct from owners.
Best of luck to ya :)
@Ronnie C. why were you unable to turn 15 specs in a year? Or am I misunderstanding?
You misunderstood :). I AM able to turn more than 15 rehabs a year, "IF" I could find the deals! I haven't been able to find a deal.
@Ronnie C. not rehabs, specs. Are you unable to find spec deals as well?
I have been flipping properties for 2-3 years and have done a fair amount of deals. All profitable
I have 7 houses for sale right now and having some trouble selling them with this market slowdown
Meanwhile, I have been trying to find another deal for the past several months. I’ve probably looked at 200-300+ deals (wholesaler deals, agent deal, on market, etc) and all of them either lose money or break even. It seems as if the market has dropped, but only on the sell side, not the acquisition side. I’m not trying to be greedy and ask too much on discounts for the flips, I am literally just trying to find something profitable
My question is…. Is everybody else having this same problem? Am I in too competitive of a market (Atlanta, GA) bc there are actually people still buying these deals and ridiculous prices? Do I just not have the right people in my network?
Thanks for the insight!
You should invest your profits into better acquisition deal flow. Sounds like you have a deal flow issue.
What are you looking to make on a fix and flip? How many properties are you typically underwriting on a given day?
If you can't make a minimum of $45 grand on a deal, it's not worth it!!! I can/could easily make that off a new spec house and more. Unless you are turning in volume 10-15 or more houses a year. I could turn 15 plus rehabs a year! But i've been struggling for almost a year to get 1 deal! $10-$20 grand on a deal is pathetic and not worth my time! Heck, you gotta pay taxes on it too, and you also run the risk of the unforeseen and problems along the way with a rehab.
Lets see, I paid my fees and got back on MLS last May, and signed up for Privy. Did nothing for 3 months straight but sit at this computer looking at potential on market deals and crunching numbers!
Now I just call or text agents and say hey, I'm a flipper, before I spend time and travel to go look at this listing, how flexible are your sellers? It's not worth the 1/2 hour to hour trip (one way) to go look at a potential deal, then crunching numbers, then spend another hour on all the paperwork required to submit an offer in writing on a MLS deal.
I also used Jerry Nortons "Flipster" last year for the free trial period! What a joke! If you are wanting to take the time and expense to mail people, I'd spend DAYS scrubbing list of people to mail to. If they haven't owned the house for 15-20 years (with a mortgage) then they aren't gonna have enough equity for you to buy it as a flipper. So i couldn't depend on Flipster, and the comps for on market properties or even an off market address I ran through Flipster was WAY-OFF. Nothing beats MLS and training from a broker who'd been in the business 20 years, and partial training from an appraiser, and this was 22 years ago. I had to school a so called wholesaler last week on his comps, lol!
I also tried Property Radar for a trial period in this time as well. Nope.
I stopped doing mailers, cold calls, etc back in 2007 and relied on MLS. I always got my deals and best deals from MLS or wholesalers who used the proven formula of 70% of ARV MINUS REPAIRS MINUS WHOLESALE FEE.
I found out the hard-way my 1st year that 10s of thousands of dollars or all the time out of my life trying to save money and do it myself was not worth it to maybe get 1 deal trying to buy direct from owners.
Best of luck to ya :)
@Ronnie C. why were you unable to turn 15 specs in a year? Or am I misunderstanding?
You misunderstood :). I AM able to turn more than 15 rehabs a year, "IF" I could find the deals! I haven't been able to find a deal.
@Ronnie C. not rehabs, specs. Are you unable to find spec deals as well?
Building lots are getting harder and harder to find! However, I know where I can still get them. The reason I stopped building new spec houses is because the market and the high interest rates. New construction in my area is sitting on the market 200-300 days going no where!
But they will buy an older, cheaper, rehabbed house in a heart beat.
What are you looking to make on a fix and flip? How many properties are you typically underwriting on a given day?
If you can't make a minimum of $45 grand on a deal, it's not worth it!!! I can/could easily make that off a new spec house and more. Unless you are turning in volume 10-15 or more houses a year. I could turn 15 plus rehabs a year! But i've been struggling for almost a year to get 1 deal! $10-$20 grand on a deal is pathetic and not worth my time! Heck, you gotta pay taxes on it too, and you also run the risk of the unforeseen and problems along the way with a rehab.
Lets see, I paid my fees and got back on MLS last May, and signed up for Privy. Did nothing for 3 months straight but sit at this computer looking at potential on market deals and crunching numbers!
Now I just call or text agents and say hey, I'm a flipper, before I spend time and travel to go look at this listing, how flexible are your sellers? It's not worth the 1/2 hour to hour trip (one way) to go look at a potential deal, then crunching numbers, then spend another hour on all the paperwork required to submit an offer in writing on a MLS deal.
I also used Jerry Nortons "Flipster" last year for the free trial period! What a joke! If you are wanting to take the time and expense to mail people, I'd spend DAYS scrubbing list of people to mail to. If they haven't owned the house for 15-20 years (with a mortgage) then they aren't gonna have enough equity for you to buy it as a flipper. So i couldn't depend on Flipster, and the comps for on market properties or even an off market address I ran through Flipster was WAY-OFF. Nothing beats MLS and training from a broker who'd been in the business 20 years, and partial training from an appraiser, and this was 22 years ago. I had to school a so called wholesaler last week on his comps, lol!
I also tried Property Radar for a trial period in this time as well. Nope.
I stopped doing mailers, cold calls, etc back in 2007 and relied on MLS. I always got my deals and best deals from MLS or wholesalers who used the proven formula of 70% of ARV MINUS REPAIRS MINUS WHOLESALE FEE.
I found out the hard-way my 1st year that 10s of thousands of dollars or all the time out of my life trying to save money and do it myself was not worth it to maybe get 1 deal trying to buy direct from owners.
Best of luck to ya :)
@Ronnie C. why were you unable to turn 15 specs in a year? Or am I misunderstanding?
You misunderstood :). I AM able to turn more than 15 rehabs a year, "IF" I could find the deals! I haven't been able to find a deal.
@Ronnie C. not rehabs, specs. Are you unable to find spec deals as well?
Building lots are getting harder and harder to find! However, I know where I can still get them. The reason I stopped building new spec houses is because the market and the high interest rates. New construction in my area is sitting on the market 200-300 days going no where!
But they will buy an older, cheaper, rehabbed house in a heart beat.
@Ronnie C.what price range are you finding the new constructions are sitting on market that long?
Real Estate Investor · Middle TN and Southern KY · Member since 2014 · 71 posts · 26 votes
2y
I live on the TN/KY border. I build in southern KY, don't want the hassle and expense of getting a TN GC license. Anywhere from $250k up in new construction. I have been watching it in southern KY since late '22 when I stopped building. Took me 6 months to sell 2 new construction houses and had to mark them down 1-$30k and the other $40k but by the grace of GOD, I still made a great profit, and was able to move on.
I kept watching the market and had calls from developers trying to sell lots. I'd see 70 new constructions at a time just sitting there with maybe 10 under contract and no guarantee they'd close.
Then I started watching the TN rehab market, and how fast they were selling. That's where I need to be. Still can't find a deal in TN.
I haven't tried to find a flip/deal in KY yet but I'm afraid it'd be the same thing. Too many people trying to do it and overpaying from the start, or not knowing what they are doing, just saw it on TV and think they can do it.
I live on the TN/KY border. I build in southern KY, don't want the hassle and expense of getting a TN GC license. Anywhere from $250k up in new construction. I have been watching it in southern KY since late '22 when I stopped building. Took me 6 months to sell 2 new construction houses and had to mark them down 1-$30k and the other $40k but by the grace of GOD, I still made a great profit, and was able to move on.
I kept watching the market and had calls from developers trying to sell lots. I'd see 70 new constructions at a time just sitting there with maybe 10 under contract and no guarantee they'd close.
Then I started watching the TN rehab market, and how fast they were selling. That's where I need to be. Still can't find a deal in TN.
I haven't tried to find a flip/deal in KY yet but I'm afraid it'd be the same thing. Too many people trying to do it and overpaying from the start, or not knowing what they are doing, just saw it on TV and think they can do it.
Real Estate Investor · Middle TN and Southern KY · Member since 2014 · 71 posts · 26 votes
2y
@James Wilcox I'm On the TN/KY border in Orlinda TN. I prefer to build in Franklin but will go to other areas. BG cost per foot is high to build vs Franklin (labor and lot cost) and BG has it's share of New construction sitting not going anywhere also. Yet they keep building.
I looked at lots in a almost finished subdivision in Scottsville in October. None of the houses that were listed for sale have sold as of couple weeks ago when I last looked.
I just hung up with a BG agent who has some new construction lisitngs in Franklin, asked if these houses were listed before the builder broke ground or has it/they been sitting there finished for 250 days. Realtors response was it/they were just dry walled when listed, and Franklin like other places is a bit oversaturated with new construction at the moment and the higher rates are not helping any.
@James Wilcox I'm On the TN/KY border in Orlinda TN. I prefer to build in Franklin but will go to other areas. BG cost per foot is high to build vs Franklin (labor and lot cost) and BG has it's share of New construction sitting not going anywhere also. Yet they keep building.
I looked at lots in a almost finished subdivision in Scottsville in October. None of the houses that were listed for sale have sold as of couple weeks ago when I last looked.
I just hung up with a BG agent who has some new construction lisitngs in Franklin, asked if these houses were listed before the builder broke ground or has it/they been sitting there finished for 250 days. Realtors response was it/they were just dry walled when listed, and Franklin like other places is a bit oversaturated with new construction at the moment and the higher rates are not helping any.
I was just curious where you where since I figured we might be close. BG is building to meet projected demand. BG is one of the fastest growing cities in the state. If you count city and county that is 5.9% rise in population projected in the next 5 years where as the state projected population as a whole is 1% growth. DoM is around 77 days.
I do agree inventory is sitting right now especially with new construction. That should ease as the spring season comes into full swing and rates are a bit more stable.
@James Wilcox I'm On the TN/KY border in Orlinda TN. I prefer to build in Franklin but will go to other areas. BG cost per foot is high to build vs Franklin (labor and lot cost) and BG has it's share of New construction sitting not going anywhere also. Yet they keep building.
I looked at lots in a almost finished subdivision in Scottsville in October. None of the houses that were listed for sale have sold as of couple weeks ago when I last looked.
I just hung up with a BG agent who has some new construction lisitngs in Franklin, asked if these houses were listed before the builder broke ground or has it/they been sitting there finished for 250 days. Realtors response was it/they were just dry walled when listed, and Franklin like other places is a bit oversaturated with new construction at the moment and the higher rates are not helping any.
I was just curious where you where since I figured we might be close. BG is building to meet projected demand. BG is one of the fastest growing cities in the state. If you count city and county that is 5.9% rise in population projected in the next 5 years where as the state projected population as a whole is 1% growth. DoM is around 77 days.
I do agree inventory is sitting right now especially with new construction. That should ease as the spring season comes into full swing and rates are a bit more stable.
I love BG, have family there and do my shopping there as well. I'm also a lifetime member at the Vette museum.
I feel sorry for all these builders paying out all that interest. If it's all cash (which I doubt for most of them) they'd be better off with their money in the bank earning 5.37% like me. You know as well as I do the longer they sit, the less they are likely to get full price for it. I'm thankful I didn't keep building.
I don't look for fed rates to decline till '25 or maybe December. A few of the Fed Presidents have been talking about rate increase. Inflation is still to strong and unemployment isn't high enough. They have no reason to drop right now. It would either be June, or December. IF they have enough votes to raise it on Wednesday, look out! Don't think that will be the case, hope not.
Real Estate Agent · Member since 2023 · 91 posts · 80 votes
2y
The problem is pretty simple for MOST flippers who have started in the past 3 years.
You NEVER really added value... Interest rates, retirement numbers, low inventory and covid relocation caused a lot of the price increases in the past few years. Your new flooring, paint and countertops were nice touches, but didn't actually create a demand for your product. Low inventory did, and a competitive market. Now that the inventory is back up and we are shifting to a buyers market, that is why it's not working out for you the same. It's a market shift, be grateful on the times you had but numbers don't lie.
Real Estate Agent · Miami, FL · Member since 2019 · 25 posts · 19 votes
2y
I respectfully disagree with Paul above. Of course, slap and list plays, where it's a few cosmetics updates and re-listing properties mostly as-is was the strategy for some, and in those cases they are priced out of the market now for reasons he stated. BUT, for flippers who take inventory that cannot be sold as-is, requiring large updates and investments to become livable and desirable, that is massive value. It creates inventory on the market that wasn't there before and increases surrounding home values in the process.
The process and numbers can still work, it's just harder to find deals...
