Need advise about Homevestors franchise or partnering with experienced investor.

14 Replies

Hello everyone,
I'm new in the investing business and I still hunted by the analyzing to much and afraid to make a move on my own. So I'm wonder if joining Homevestors franchise is a good idea? Or if partnering with with a experienced investor is a better option to begin investing. Or is there any REI meetup group in the Bay Area?

I am not specifically familiar with Homevestors but I strongly suspect they are not handing you a business in the box. Not like say a McDonalds franchise would. 

I would question VERY hard their success rate. Franchises take a heavy cut off the top which can make it very hard to be profitable. At least one person tried to be a Homevestors franchise here in baltimore but they didn't make it long. There is NO brand recognition here in Baltimore. Is there i your area? If not why pay for brand recognition you are not getting? If I am going to have to build the brand in my area, I want to build my own brand. 

I am sure there is either meetup groups or REIAs in your area.

Medium crab1 copyNed Carey, Crab Properties LLC | http://baltimorerealestateinvestingblog.com/

Hey @albert F,

Ah, suffering from ye olde paralysis by analysis, eh?  A common ailment, especially here in the Bay Area where so many folks come from a tech background.  

I know of at least three people in the Bay Area who have Homevestors franchises.  I believe they are doing well, but all had lots of experience before buying the franchise.  I also know they exact a substantial fee from franchisees, but apparently it works for lots of people.

Attending local Meetups and trying to hook up with a mentor is also an excellent option.  Just don't stress too much about not knowing enough to get in.  If you wait until you think you're ready you may never do a deal.

I know its a bit of a hike from Pinole, but I run a Meetup in San Jose.  The next meeting is January 28th and will feature an open Q&A with Michael Quarles.  It will be a particularly good meeting for learning.

Good luck and Happy hunting!

Cheers,

Jeff  

Jeff Pollack, Trident Equity Group | [email protected] | 650‑533‑8534 | https://www.meetup.com/San-Jose-Real-Estate-Networking-Club/

Albert,

I occasionally receive letters from HomeVestors. I guess it's because I own rental properties. They claim they did over 3,500 transactions nationwide in 2014. 

There is nothing special about their letter. There is no name recognition IMO. Just ask everyone you know if they know who HomeVestors is. Than you ask them if they know who Coldwell Banker or Keller Williams is, and you will know what I mean. 

I don't know what they offer to their franchisees and what kind of split/fee you have to pay them. You should vette them thoroughly before moving forward. Signing up and paying a fee are easy to do. Getting a refund for not happy with their service is .........?

Good luck. 

Originally posted by @Michael Quarles :

and I hope casual attire.  

Well, then you haven't been to @Jeff Pollack  's meet-up yet. It's formal, not even semi-formal. You'd better show up in a suit. 

JK. You can show up in your undies for all we care. Well, not that casual. Shirt, jeans and a pair of shoes or slippers will do. See you in a week. 

Albert,

I am currently a Homevestors Franchisee for 3 years in NJ. I can tell you, I would do it again!

Dave Fontana, Diversified Acquisitions Group, LLC | [email protected] | 7184834179 | http://www.quickbuyr.com

@Jeff Pollack
I wish you guys could videotape these meetings and put them on the YouTube so others can see and hear your guests, such as @Michael Quarles!

@Albert F.  I looked into the HomeVestors franchise on a couple of different occasions.  I think their business model and the fact that it is a team approach is nice and very beneficial to most.  But, they require a large upfront fee $15K or $50K, a percentage of each sell and then recommend you spend a minimum of $3,000 per month on advertising, although it is up to you what you ultimately spend.  I spoke with several individuals who are franchisee's and they sounded like it was pretty slow going.  Not that many leads and one was already $50K in the hole.  I personally think you could be a lot more successful if you spent $3,000 per month on your own marketing.  That way you could direct it to the exact type of seller you want instead of billboards, Tv or radio.  Then, spend some time on BP getting to know who the real players are and connect with them.  They will be more than happy to answer any question you might have.  That's just my two cents. 

John - I recall discussing the HomeVestors system with you around 18 months ago. As part of the HomeVestors system, I've bought about 100 houses since that time in DFW. How's the 'solo' thing working for you? Not saying it's not possible to be independent (obviously, most are), but more than anything...the HomeVestors system draws a clear delineation between the 'doers' and those that talk or think about doing it for years...without realizing the opportunity cost of time lost by not getting started sooner.

My two cents...

Originally posted by @John Hixon :

@Albert F. I looked into the HomeVestors franchise on a couple of different occasions.  I think their business model and the fact that it is a team approach is nice and very beneficial to most.  But, they require a large upfront fee $15K or $50K, a percentage of each sell and then recommend you spend a minimum of $3,000 per month on advertising, although it is up to you what you ultimately spend.  I spoke with several individuals who are franchisee's and they sounded like it was pretty slow going.  Not that many leads and one was already $50K in the hole.  I personally think you could be a lot more successful if you spent $3,000 per month on your own marketing.  That way you could direct it to the exact type of seller you want instead of billboards, Tv or radio.  Then, spend some time on BP getting to know who the real players are and connect with them.  They will be more than happy to answer any question you might have.  That's just my two cents. 

Regarding the trademark "we buy ugly houses."  I have a Homevestors question. . . .hopefully the group here on BP has some experience to weigh in.  I've heard of the extensive efforts by Homevestors to protect the "We buy ugly houses" trademark.  I was even told once that they will sue for the use of "ugly house."  I'm working on some marketing that may include billboards, and I keep coming back to the word "ugly" being one of the best words to use.  I know I cannot use "we buy ugly houses" but can i use the word ugly or uglier?  How about "if it's ugly we'll make an offer."  Or "the uglier the better."  "Fast cash for houses, ugly or pretty."  or, "Ugly houses are our specialty" or "we specialize in ugly houses."

Please help BP!