All Forum Posts by: Chad Shultz

It is often said, "You make your money when you purchase, rather than when you sell."  With that in mind, if you buy right, there almost isn't a bad spot to stay away from.  However, you can certainly improve your chances at success by focusing on areas that may be better than others.  Personally, I stay away from areas with heavy rental occupancy, if I am looking for a flip.  I like to focus on areas where the home prices are just below the median sales price.  Generally, these properties have good room for profit and you tend to risk less, since you can enter the project at a lower cost.  For example; most of the properties I do will "retail" for $200k to $250k.  In my market, that is generally the "middle-class" income or blue collar and lower white color neighborhoods, etc.  I will usually purchase these in the range of $110k or less, do full rehabs at a cost of $40k - $60k, then sell at a price near the median.  I find there are more people looking for homes in the median price range, than there are people looking for $400k and up homes, etc.  If you are going to potentially make $40k - $90k on a flip, why not do it with $150k total invested, rather than see the same profit with $300k invested.  Lower risk, same result, more potential customers to buy your product.

Investment Info:

Single-family residence wholesale investment.

Purchase price: $183,000
Sale price: $225,000

Quick "Whole-tail". We bought this as a wholesale and wound up selling it on the retail market to an end user for under retail finished price. All we did was take trash to the dump and mow the lawn twice.

What made you interested in investing in this type of deal?

The hot market allowed up to do a quick turn on this property, making it irresistible.

How did you find this deal and how did you negotiate it?

Found as a probate project where the heir just wanted to get rid of the property, because he lived out of state.

How did you finance this deal?

No lender money was needed for this deal, we used our own cash.

How did you add value to the deal?

We mowed the lawn and threw out trash. No money invested.

What was the outcome?

Held the home for 29-days and made a good profit.

@Rachel Hutcherson:  I sent you a connection request.  

Rachael: Bigger Pockets doesn't allow me to include contact info. The Volusia Chapter is last Thursday of the month in Holly Hill. The area REIA group (General Meeting), over six county REIA chapters meets first Wednesday. This month the general is via Zoom, so you can attend from anywhere. If the email above shows up, send me a message and we can connect.

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $62,900
Cash invested: $57,000
Sale price: $181,500

Bought a "burn out" home that had a rehab started, but the owner ran out of money. Inside was open studs when we bought. We completed the renovation and rebuild with all permits. Property sold for highest price in neighborhood at the time.

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $70,000
Cash invested: $91,000
Sale price: $204,500

Foreclosure property, needed foundation work in addition to a full gut reno. The amount of time was due to COVID shutting down the courts and making us wait on title. We had to sue the County to get the title, then then project only took about 3.5 months.

What made you interested in investing in this type of deal?

Sometimes, we do deals most others are afraid of.

How did you find this deal and how did you negotiate it?

This was a foreclosure at a County Auction.

How did you finance this deal?

Paid Cash - personal/business funds. Did not use a lender.

How did you add value to the deal?

Full gut renovation of entire property.

What was the outcome?

This was bought as a 3/2, but turned out to be a 4/2. We did foundation work and a full renovation of entire property. Sold for asking to first buyer.

Lessons learned? Challenges?

Do more background on properties before auction bidding.

@Brian Morales - Congrats on the Palm Coast pending move. I am in Ormond and have done about 20+- projects in Volusia County, one in Palm Coast, over the last couple years. I think the largest "cloud" over Palm Coast is the heavy code enforcement by the city. It is like one very large HOA that you don't actually participate in. That can, of course, be good or bad, depending on if you are being enforced against, or watching the City keep your neighbors from being a pain in the neighborhood. That said, my Palm Coast project sold to a buyer who never saw it in person. It is very popular for buyers, especially from out of state. Ultimately, you are only about 25 minutes from downtown Daytona, where all the fun happens. At the moment, I run the Volusia REIA group, so connect with me when you get into the area, if you want to be around like minded people willing to help with guidance.

It seems the common theme is stay out of 32114, which I agree with, but I like many parts of 32117.  All other local areas area usually pretty good.  I have done 16 properties locally, with six in 32117.  It is my favorite zip for flips.  You should get "boots on the ground" and take a look around.  There is a lot of potential.  I also have a 32117 rental, which performs amazing and has for years.  Like everything else, do your homework and connect with a local, like me, if you like.  I am licensed, also a well known investor and have done several different types of structured deals.  Best of luck.

@Nick Johnson - Nice!  We should connect and chat sometime.  I am also in the Ormond area and just locked up my 15th house project.  We can likely play off of each other, if you are looking for more, because I don't go after everything that comes along.  There is always room for others.  Cheers.

Welcome to Real Estate Investing.  A true wholesale deal will require you to come up with little to no money, so you don't need a huge bank roll to start.  What you need is patients, persistence and time.  There is a lot of competition in wholesaling.  I know local wholesalers in my market who spend over $4k per month, just on mailers and advertising.  A simple way to start is to "drive for dollars" around your local areas and focus on some obvious trouble properties.  Another way to get going is find your local RE investors groups and join.  There, you will likely be able to find people to partner with or mentors, etc.  Don't fall for the "free to attend" local workshops from "national names" that are only there to milk thousands out of your wallet.