All Forum Posts by: Bob Okenwa

@Greg Larson

For flips, it can be beneficial to be licensed to save on the commission when you sell. As a licensee, you already know the benefits of having immediate access to properties as well.

Seeing as you have recently moved, it may be beneficial to learn the area before representing yourself. Working with a knowledgeable agent can open the pipeline to contractors, PM's (should you need it) and lenders. I'd work with a good agent, learn the ropes for a little in your new area, then consider being my own agent going forward after that.

I wouldn't spend a dime on a real estate degree unless I planned on being an architect. Between Google, YouTube, and BiggerPockets, there is more than enough information for free or very cheap that will help you learn to invest. 

I'm willing to bet that only a very small amount of successful investors here went to college with the sole intent of becoming an investor.

If I were dead set on going to college, I'd major in STEM. I may be biased because I'm a CS grad, but the money you can earn will help you build capital and the critical thinking and analytical skills you learn to sharpen will help as well.

It's a toss up between analysis/paralysis and initially not having enough money, especially with the pricing and uncertainty of todays market.

@Alex Case

Many people have OOS rentals here. It can be profitable if you know what you're doing, but isn't for everyone. I'd start by reading David Greene's book on long distance investing. It'll tell you pretty much everything you need to know to get started.

@Patrick Kaiser

Flippers are trying to extract all the juice from the orange so to speak and I've dealt with this before. Had a property on the market 1.5 years that I felt should list at 379.9k. Seller threw all my logic out of the window and said that 397k was the number. No real market analysis behind that price or anything, just felt that we could get more as we had the best home in the neighborhood and very good features.

We ended up going in and out of contract 3 or 4 times and the appraisals kept coming back between 360k-375k. Ended up closing at 372k. This was right before the spring surge. The same home just sold for 475k a month ago.

I'd advise to get an appraisal. Appraisals aren't foolproof, but maybe it can help ground their unreasonable expectations. At the end of the day, you can only lead the horse to water but cannot make it drink. A more successful realtor I know will advise the seller about what the market price is and if the seller wants to go above the suggestion, then it can only remain there for 2 weeks. After that, she takes control of the listing and will drop the price as aggressively as she needs to get it sold.

Managing expectations is key and must be done in advance, but it's very hard to reason with unreasonable people.

@Solomon McConnell

Learn your market. Know it inside and out. Also spend the time to learn how to speak to investors and what a good deal looks like. This will help as an investor and an agent. Go to meetups and build out your network and keep a strong presence on social media.

It might behoove you to join a team at your brokerage so you can learn the ropes from more experienced agents and get a few deals under your belt while you learn.

Rent control is the mother of the law of unintended consequences. RC actually restricts the market and forces prices up and brings down quality as there is little incentive to keep your property in its best shape.

https://www.bloomberg.com/opin....

@Joey Chrisman

We definitely have people who are getting caught with their pants down that cannot sell flips at their project ARV. Their projections were way off and they are no left holding the bag. Many investors don't want to catch falling knives and won't take on such projects unless they get it at that very low prices.

Sellers are still using comps within the last 6 months that are no longer relevant to the current market. Hell, closed comps from 3 months ago don't really apply to the current market here as the market dynamic has shifted greatly and buyers are being forced to the sidelines.

I can't wait to see OpenDoor's ad Offerpad's earnings next month as they own a lot of property out here that has been sitting forever, even with them finally doing price reductions. I know they make a decent amount upfront on fees, but they can't sell every home for 70k less than what they paid for it and expect to last. Ask Zillow how that went...

@Joe Ludwiczak

If you have to put that much down to cash flow, you're fooling yourself into buying cash flow. You should find another "deal" and run the numbers at what will actually cash flow at 20% down.

I would be hesitant to use today's comps in my market as what sold in April probably went under contract in February or March, and the market was considerably different then than it is today. Phoenix is amongst the leaders in the percentage of YoY price reductions as of last month. 

Depending on how long it would take to rehab a property, I'd definitely price in a bit of reduction, especially if you're in one of the faster-cooling markets. The numbers we see today will probably look different (lower) 6 months from now when today's closings will be the comps for the properties that will sell in the winter.

https://www.bloomberg.com/news...