Hey everyone, was wondering how much success people have had lately flipping houses in the Los Angeles area (including Orange County, Inland Empire, the Valley)? With home prices on the rise I was curious if there are still deals to be found in order to turn nice profits. If so are they in foreclosures, REOs, or seller direct? Any areas in particular?
@Will Barnard is the best flipper I know out there. Perhaps he can give you some insight since he's primarily doing very high end properties now.
My business partners and I purchased a foreclosed property in Downey, at an auction, and are looking to make a decent profit on it. There are definitely deals out there, I've seen some good ones at auctions, but I believe the best deals are seller direct.
There are no deals left in Los Angeles, everybody needs to look elsewhere if they want to make money in RE.
Did anybody fall for that? . . . . . .
In all seriousness, deals here in So Cal are much thinner than before and much more difficult to find. Those who do direct marketing and find motivated seller leads will find the deals with the best spreads. Repositioning properties and development are hot and have heftier spreads but you need to know what you are doing to enter that arena.
I believe the key is to lock in your numbers so there are very little variances, hold a RE license to get paid on both ends, and do quantity, though the profits may only be $20k-$40k, each. If you do quantity, you can do ok.
The higher end market will deliver bigger spreads but the timeframes for renovations and selling increases so you have to be careful there too. I have done well on some and not so well on others and that is with lots of experience. With little to none, better to stick with the standard homes and work hard to find as many of the small profit deals as you can.
Originally posted by @Jon Saputo :
With home prices on the rise I was curious if there are still deals to be found in order to turn nice profits.
What kind of profits are you looking to make and how hard are you willing to look?
I see margins getting thinner in Los Angeles and good deals hard to come by as I see that investors are either over speculating or willing to work for less in order to keep the ball rolling. Most deals on the MLS are getting over bid. I'm having hard time finding my next project. I am only on my #3 but here is an example of my last deal. Bought it for $500K put in $285K (addition and rehab, carrying cost) $55k closing cost. Sold it for $920k made $80K. That is with out borrowing otherwise I would have made only half of that. I'm happy I made money but for the length (8 month) of the project, and the amount of work and the risk. I don't think it was enough. And I have my own crew as I am the builder contractor. Definitely no room to hire a general. I guess those are the margins I have the get use to. One thing I need to mention I am truly enjoying this business and seeing the final product.
@Jon Saputo , we buy in the Inland Empire at trustee sale. Tight margins. However, on our hard money side, there are still deals. Definitely slower than 2013 but still happening. However, the methods of attaining those deals have changed drastically. More equity sellers and less focus on distressed sales via short sales and REOs. That also means a very different method of marketing for those deals.
Updated over 2 years ago
There are great deals here and on the edges of L. A. COUNTY still. You do have to look for them, they will not fall out of the sky.
@Mauricio Hernández I too am I contractor how have you been doing lately, working on anything currently? Would love to hear from you!
Hey there! My business partner (who is the contractor) is jamming.. Construction is nuts right now! We are actively looking for deals.. Few and far between..! ;) do you invest too?
@Vanessa Ryder Happy to hear your just as eager as me! Yes I purchased a 2 Unit Single Family and rent it out.
I still live at home so it's easy for me to save and continue to look for deals. Any luck finding anything in LA lately? I have access to the MLS since I have my license but I'm having a hard time finding anything worth jumping on.
Yeah @Jamie Garcia ! Right there with you. Very few deals..
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