Altus, OK · Member since 2008 · 2k+ posts · 690 votes
Flip Men on Spike TV
For those who don't know what it's about,it's about 2 men who buy properties sight unseen,rehab flip them and sell them for profit much like the earlier flip shows only difference is that they buy the properties sight unseen and take the risk of buying badly damaged homes in order to turn a profit.
My favorite part was their original exit value of $139k that magically increased to a final sold price of $189k. So basically, because they added a bath upstairs and took a week to paint the exterior brick (yeah right) and they changed the layout of the staircase and opened up a wall, they gained $50k in value? I cant wait for my next project, I will add a $4500 bathroom, do some additional paint work and open up a wall so I can make $50k too!!!
Entering a home before the auction is generally felony breaking and entering. Usually a home is secured in some manner. Opening a window, jimmying a lock, etc is breaking in. It's a misdemeanor trespassing charge at best if the door is wide open, and you can prove it was wide open before you arrived.
I wouldn't claim to do it on national television either.
As for who would press charges, charges are brought by the local prosecutor. You don't need the homeowner to file a complain if you get caught in the act (or have a neighbor call the police).
Do I think you'd actually get charged? No, or I wouldn't do it. But it's possible if you get the wrong cop on the wrong day.
Our guys wouldn't enter a property they don't own- we believe it's breaking and entering as well as trespassing. Doug and Mike try to get a visual on the property during a scout before the auction- although it doesn't always happen.
To answer Justin's blog, while I produce a bunch of other television shows, I do not produce the Phoenix auction show.
I agree Marc, my point was IF a door was wide open or at minimum, unlocked.
All that legal stuff aside, every house has windows and often in these trustee sale homes that are vacant, there are no window coverings so anyone could easily just peak through the windows throughout the home and get a good idea of the condition of the interior.
Once more, going back to the gang house show, the one guy went around the home and kicked some boarded up window (although not with much force) yet never thought to even simply check to see if the front door was unlocked or not. If he had, he could have opened the door and without entering the property would have seen enough to realize the extent of the interior damage. (that is just common sense to me) Which leads back to my point and many others that this show is done in such a way to create the drama necessary for people to watch it.
They also claimed to have spent only $26k in repairs and $3k in time delays on this home. Really? A full gut job, drywall entire home, including ceiling, paint in and out, carpet/flooring, landscaping, new AC, 2 new bathroom remodels, new kitchen cabinets, countertops and appliances, new doors and hardware, new windows, new insulation, and staging - all for $26k? Sounds like $45k+ to me.
As I mentioned earlier, these guys are in my market so I'm familiar with them (we have bumped into each other 3-4 times in the last 5 years). They have been part of the regular Salt Lake County "good ol' boys" auction crew for a few years now. I'll give everyone a quick run down from an unbiased real world perspective.
-They are actually the ones at the auction. I don't go much, but when I do they (mostly Mike) are there. No errand boys on cell phones.
-They might use their own money for the properties purchased ON THE SHOW but I know they use OPM as well (i met a guy who had loaned their company money). Most experienced investors do. This drama about, "we could lose everything!" is totally bogus.
-From what I can tell they don't really branch out into other methods of finding. This always surprises me but it seems like most trustee sales buyers don't seem to branch out. I buy REO, from private sellers, short sales, etc. They seem to be strictly auction buyers.
-I seriously doubt they ever do any actual work on their projects, that is TV only stuff. Should be fairly obvious. They are not the grunts, makes for better TV though so I'm sure they did a little work on some for the cameras.
-trespassing or not, I'm sure they try to get into every property before they buy it. They might not while the cameras are rolling but these guys are not above it. Anyone who buys at trustees sales tries to get in if they can tell the property is vacant.
-Last weeks show in Rose Park was laughable. They portrayed Rose Park as this horrible gang infested neighborhood but it really isn't that bad. Yes, there are gangs there, but it is NOT comparable to South Central. This episode had way to much drama about them vs. the gang. Comedy. And having their "street security" sleep there at night? Drama, drama, drama.
Since I'm taking the time to type this post anyway I'll share a funny experience I had regarding it. My friend and I showed up to the Salt Lake County auction earlier this year and all the cameras and boom mikes were there. I asked a regular what was going on and he told me it was for Mike's show. I didn't think much of it at the time. We ended up buying two properties that day which is extremely rare because of the CRAZY prices people always seem to pay. After the auction my friend and I had to sign a release allowing us to be on the show (I doubt they will ever use the footage). As we were walking back to our car after the auction I bumped into Mike and I asked him about his new show and generally just tried to make a little small talk. I said, "so, you guys buying a lot these days?" and he gave me a smug, "yeah, but not like those." implying that we had bought bad deals. I'll be honest, his attitude pissed me off a bit and increased my distaste for smug auction "regulars". Can't show a little respect for a fellow investor? He knows I've been in the game for as long as he has. I'm not just some idiot newbie who doesn't know what he is doing.
Mike- let me tell you how those two deals worked out. One was sold that day to the guy (another "regular") who bid against us, he paid 2k. The other was a light rehab (8k) and was sold within 90 days to a end user for a NET profit of 20k. That is a solid base hit in my market all day long for a house purchased for 100k.
So there you have it. Any other questions from the peanut gallery for a guy actually in their market? :)
Not only do our guys do a lot of work themselves, but they have an in-house crew that's on their full-time payroll to do the work. The costs that the guys spend on each property are accurate.
Also- the guys DID enter the GANG house through the front door- they realized that although the windows were boarded up, the front door was completely unlocked. There was no "Break-In' needed after they purchased the property- unlike the METH house in our first episode.
You're not fully accurate, but I won't try to convince you otherwise- that's not my reason for deciding to post on this board. I will tell you however that whether you feel Rose park has a lot of gangs or few gangs, the fact is that there are gangs in that area and the house the guys bought was attacked several times during our production. That damage that was done prior to the guys buying the house was real as was the damage after they bought the place.
By the way, Tyrone is a guy that they've been using to "Watch" their homes for years prior to us coming in and making a television show in your market.
Thanks for signing our release- you probably will make it into an episode.
-From what I can tell they don't really branch out into other methods of finding. This always surprises me but it seems like most trustee sales buyers don't seem to branch out. I buy REO, from private sellers, short sales, etc. They seem to be strictly auction buyers.
I think to be good at auctions requires a LOT of work. The rewards are there, the time is not, so there's not much point in branching out until you have to. A show like this could bring in enough competition to make you have to.
Dave,
I'm really glad you came by to chat about your show. It says a lot about you to actually come to where investors hang out and put yourself out there. Don't take these guys personal. Some don't like competition, some don't realize that maybe others work differently than everyone else.
TV is TV and you guys need to show what will get you ratings. Personally, I enjoy shows that go more in-depth in the rehabs, showing how to do things correctly, like Holmes On Homes, In-A-Fix, etc.
Either way, stick around. Maybe you can learn some of what needs to be shown to help people who really want to get started in real estate. Encourage your guys to join too. You can only become more successful by learning and teaching.
I don't dispute the fact that it was trashed when they bought it. I was just speaking to the drama of the episode. Salt Lake does have real gangs, no doubt. But Doug telling Mike on the phone, "you better get out of there before you get shot"? TV drama.
They really have Tyrone watch their rehabs? That might be true, but I've been actively investing in their market for 8 years now and I don't know anyone who does that. In fact, I have 4-5 other close friends in my business, who do a lot of rehabs as well and none of them have "street security" either. It just seemed dramatic to me. But I guess it should be, it's TV right?
Let me second what Marc just said. I do respect the fact that your here talking about the show. I know there needs to be drama so people will watch it. I also would rather see more in-depth stuff but that is probably just because I'm in the business. No disrespect to you or the show, you seem like a talented professional.
Mike's lack of courtesy rubbed me the wrong way that day. Maybe he is just trying to keep up his tough guy poker face for the new faces at the auction. Maybe he was just having a bad day. We had a deal that we collaborated on years back and I just expected a little more respect. Obviously no reflection on you or your show.
Thanks- I appreciate it. I always try to reach back out to the people who talk about my shows- and I look more for what people are negatively saying than what might positively be said-sometimes I get great ideas from our audience. I came to this sits because you guys are the real deal- doing this stuff for a living- and I don't make trash reality- I try and make true, compelling shows.
That being said- of course I need to play the drama and milk the moments for good television- but never at the cost of faking something- and Andy- yes I agree with you about Doug's "Get shot" line- he really did say that but more in a tongue-in-cheek kind of way and we didn't play it like that. I know that Tyrone has been used to come out on jobs and not only watch the house, but watch things like their tools that get stolen- maybe they're buying homes in riskier areas than the typical SLC buyer?
Anyway- I appreciate the feedback from you guys and like the open discussions. I'm used to getting beat up- that's what happens when you put things out in the public. Luckily, way more people like than dislike- I'm fine either way- as long as they watch!
Love to continue to hear everyone's thoughts. This Tuesday's episode is a pretty strong one.
@ Dave - It is nice to see someone new come here, take quite a bit of flack (not directed at you personally of course) and have thick enough skin to stick around and engage this community - that says a lot about you personally.
To be clear (to avoid any misunderstandings) my comments regarding the show are about my distaste for the untrue I know to exist in many other shows and has nothing to do with you personally.
I respect your comments back and have enjoyed this back and forth "brainstorming" and critique of your show (and all reality shows). Regarding your comment that the expenses were accurate, I can only say that you can only know that which is tld to you by the two investors on your show, however, that does not make it 100% true either. I know rehab costs in and out and also have my own crews, I do this for a full time living here in CA and I have done it in other states too. For the work needed and the before and after video of that gang house, I can say that the materials alone would cost in excess of $25k, even if those guys did all the work themselves and would not come close to covering the costs of their project manager chica or their security guy and balance of laborers.
Either way, as I stated before, if you ever want to chat regarding RE rehab flipping reality shows or my show proposal, feel free to contact me, North Hollywood is only 20 minutes from my house.
These guys obviously have no clue on basic home repair. They are stumped on the most simple of home repair items. They are typical "professional flippers" that have no idea about the business.
Also, anyone that has been in this business for any amount of time and knows anything knows that you can break into any house anywhere in minimal time without doing much damage. The whole premise of this show is absurd to me. These guys have all of these "surprises" because they don't know what they are looking at when they walk a house. If you're going to present yourself on tv as a "professional", then a be a professional. This show does nothing but gives people out there like me a bad name because it makes the general public think we're all fu***** idiots.
I don't dispute the fact that it was trashed when they bought it. I was just speaking to the drama of the episode. Salt Lake does have real gangs, no doubt. But Doug telling Mike on the phone, "you better get out of there before you get shot"? TV drama.
More likely to get thumped in the head by a bible touting missionary than shot... but such is the life in Utah... keep your head on a swivel!
Gents, remember... TV is entertainment... sure, it's great if you pick up a tip or two here or there but beyond that, set your expectations relatively low.
Ok gang -
I admittedly haven't read this thread in its entirety, but can tell that, as always, you guys have strong opinions on this show. With that in mind, I've been contacted by the publicist of Flip Men to do an interview with Doug and Mike from the show.
So . . . here's your opportunity:
What questions do you have for them?
As you know, I'm all about breaking through the BS, so feel free to keep it real with the questions.
Lets see what you come up with and we'll start getting some answers and post the interview on the BP blog.
1) Since it is just the two of them apparently, and they are buying sight unseen... do they also not have title reps they work with to determine if their targets have liens/taxes etc?
2) What are their average turns, cost of rehab, and return on invested capital (either annualized or ROI, but make sure they specify which figure they are giving you)?
3) What percentage of the properties that they buy end up being vacant?
4) For non-vacant properties, what percentage of them require litigation vs CFK?
5) How many properties do they hold in their inventory at any one time, and how many do they buy on a monthly basis?
6) How many deals (real number, not a percentage) have had a negative or zero return on capital invested?
I was given their Skype address by the show's publicist to connect and attempted to do so a few days ago, but have yet to hear back. I'm starting to think that this may not actually happen . . .
I was watching this show last week and they put a deck on the back of a house and said it was the first one they have ever done. Is this their first year? It seem like a risky business to not know what you are doing on the construction side and to take on houses sight unseen.
If you ever do talk to them... What is the deal with the mold. They act like they could die any second because there is some mold. It should be taken care of but most mold does not kill you and is in the air all the time.
My final question would be how do they find parking at the courty house so quickly! Every time I go to court I have to show up 45 minutes early. They are always looking at the house 10 minutes before the auction. Lucky.
The last 4 responses in this thread are more proof of what we all have been saying. That "reality TV" like this show, is not real life reality, just partial with lots of dramatization (case in point - their tag line of "we could make $500k or lose everything" since when can RE go to $0 value????) lots of falsified or left out information, and even a few incorrect things.
I actually watch this show from time to time and contribute to the Nation's need for "reality TV" - let me apologize now - and do so for the entertainment value as I get a kick out of some of the stupid things that go on that would never go on in my business as well as the fact that I love to check their numbers at the end to see how far off they are. To be fair, of all the RE TV shows, these numbers are much more close to real because they include selling and holding costs where other shows never do which artificially inflates profits.
One thing I have noticed recently that is so far off is their - "everyday beyond the 7 days costs us $750 per day". Really? A $175,000 cash purchase costs you $22,500 monthly in hold costs? Even if you factored in opportunity costs at a high valuation, you would get nowhere near that figure! I must say, I do enjoy the comedy!
Ok guys - I just spoke to Doug Clark from the show. We're working to do an interview in the new year some time via Skype. Meanwhile, he seems like a really down to earth guy and he volunteered to drop in and join you here on the thread . . .
So, to Doug -- Welcome!
Hopefully he can give you the answers you're looking for on the show and his business.