All Forum Posts by: Andrew N.

@Brittany Euwema - Welcome to BP!

Cuong's advice to check out Ultimate Beginner's Guide is a great first step.

If after looking at the high level view of the different aspects of RE Investing you have determined that you are still interested in doing Flips you should check out the Bigger Pocket's Book on Flipping Houses & the Estimating Rehab Costs Book. I'm working my way through them right now and they are a great resource to learn how to approach flipping in a professional manner.

As far as investing in rentals are you looking for appreciation or cash flow? If you are looking for properties that cash flow well you will probably be better served looking outside of California. The higher priced real estate markets like California, New York, etc. tend to offer poor cash flow.

Welcome Francisco. I'm in the Bay Area myself. I think you'll find BP a great resource for REI knowledge. If you haven't yet you may want to check out the BP Ultimate Beginner's Guide. Its a nice overview of different facets of investing.

@Tim G. - Hi Tim. I'm trying to figure out what kind of marketing and budgeting I should do if I wanted to target a California market and I had a couple of questions based off your post.

You mentioned that you get a .05-1% (also did you mean .5 or .05?) response rate in your market of California and that you require 2500-5000 mailers per deal. I was wondering if you were exclusively using Post Cards, Yellow Letters, Professional Letters, or some combination of the above.

I've been led to believe reading other posters that .05-1% response rate is more typical of a Post Card only type campaign but generally with a far higher quality lead than a Yellow Letter just saying "I want to buy your house". I've also heard that Yellow letters can get 5-10% but that the quality of leads can be very poor.

Have you tried Yellow Letters? What is your opinion on their effectiveness in California?

Also you mention that it might take 25 solid leads to get a deal. Do you generally consider the .05-1% that respond to your materials solid leads or is it some smaller percentage of those responders?

Thanks in advance!

Rogue sounds great to me! See you then.

@Johnson H. - Hey Johnson. It's great to get some feedback from someone with experience doing out of state rehabs and buy and holds.

You mentioned the need to fly out to your market and I'm curious how often you schedule these trips and if they coincided with certain predetermined milestones. How often do you recommend visiting your rental properties and/or your rehab projects? Were you able to find good Property Management in Phoenix (and now Houston)?

In general I am not opposed to visiting property I have to fly to as long as the profit margin can justify the additional expense.

By the way I see that you might be going to Sarah's SF BP get together too. I hope I get to meet you there in person and ask about your virtual investing processes.

@Alex Harris - Hey Alex. Yah your points make a lot of sense. I think I'm leaning towards focusing on my local market at first to keep the learning curve as small as possible as I start off. Once I feel a little bit more comfortable with the process I'll probably do as you suggest and focus on my local market but also expand my marketing into my desired Buy and Hold market so I can pick up experience with virtual deals and marketing to that geographic area. Its good to hear that Virtual deals aren't ridiculously harder than local ones.

In your opinion, since you do wholesaling in multiple markets, have you seen drastic differences in rehab costs in different geographic locations?

In my case I'm curious how well estimating rehab costs in California might translate to estimating rehab costs in Texas or Arizona. I'm sure the process will be similar but the labor and materials costs should be on a pretty different scale I would guess.

@Kris Lai - Hey Kris! Welcome to BP. I'm from SF too and i'm going to Sarah's BP get together as well. Hope you can make it!

Since it hasn't been recommended yet you should also check out the Bigger Pocket's Podcast if you want some REI audio inspiration. There is a ton of great info and genuine success stories.

@Paul Timmins - Wow thats an interesting approach. I think I actually lived in a converted house, like you describe, one summer in college. It was cramped but served its purpose at the time.

I'm curious how your friend created that deal for herself. Did she have a prior relationship with the owner and convince them that converting it into student housing was a more advantageous arrangement? Or was the student housing already being operated by the owner but your friend took over filling the beds because the owner no longer wanted to be responsible for the legwork? Is there some tried and true method for finding these arrangements rather than just networking extensively?

Thanks for your feedback and tips. I really appreciate it.

Hey everyone,

I am wondering if I should begin by trying to focus on working in my local market (San Francisco Bay Area) for Wholesaling and Rehabbing or if I should attempt to do Virtual Wholesaling and Rehabbing in the market I will eventually try to Buy and Hold. My eventual goal is to rehab and then buy and hold cashflow properties out of state as CA properties tend to be more appreciation plays. I have a 4K per month marketing budget.

I feel as if the virtual lessons will have to be learned at some point and the real question is whether I should try to front load that learning when starting out or if I should try to get experience in a local market I know better. I've written what I consider the issues of each approach below. Any comments on things I missed or should also consider would be appreciated. Any advice is welcome!

Pro Virtual:

• Learn my future Buy and Hold Market
• Learn how to Virtually Estimate ARV
• Learn how to Virtually Estimate Rehab Costs
• Learn how to Virtually Close
• Learn how to Virtually Rehab
• Cheaper Properties - Buy and Hold as a backup Exit is more manageble

Local

• Less Market Learning Curve
• Look for closer to 75% ARV and thinner % spreads
• Possibly Higher Margins ($ per deal) for rehab due to higher prices
• Managing Team & Contractors Locally
• Very Competitive Market