All Forum Posts by: Dustin P.

Hey @Andrew Libuit

Welcome to BP! Lots of great resources and information on here.

I wholesale in Phoenix and could also recommend some contractors as well (Although I would recommend getting bids from several different contractors to familiarize yourself with price points).

As far as hard money is concerned, Boomerang Capital / CapFund1 / Merchants / Clear Mortgage are all great reputable lenders in the area.

Feel free to PM me if you ever want to chat

@Anita Ahuja

@Anita Ahuja

I'll second what @Bob Okenwa said about the price. I just comped it staying between 32nd St, 36th St, Oak and McDowell. The highest to sell in this area was 3323 E Cypress St which was a little smaller and without a pool and sold for $305k. It's also further north though away from McDowell and in a different subdivision. After that comps fall off to the $260k range. You may get the $300k but you'd have to sit on the market longer, like Bob said 60 days on market is getting to be the average right now and if you're asking for top of the market you're likely to sit even longer. I work right off 44th St / McDowell so I know the area and McDowell is still a little sketchy, the prices aren't quite into the 300s there yet.

I ran some rental comps also and I think $1900 may be a little high, although rents are going up right now. You may be closer to the $1500-1600 range with only 3 bedrooms. There is one that rented just a couple streets over for $1800, 3437 E Holly St. It's almost as nice as yours, not quite there, but also 200 square feet larger and 4 beds 3 baths. 

For property management I've heard some decent things about Renter's Warehouse but haven't used them myself.

I think my goal will be around $20k a month. We are trying to buy 3 or so rentals a year in Phoenix doing BRRR so when we get somewhere between 10-15 we can decide if we want to just start paying all the mortgages down to be free and clear sooner or start funneling that money into something else. I don't plan on getting much real cash flow but tenants paying down mortgages, low vacancy and hopefully some appreciation over the years.

I don't think I'd ever stop working though, it's more freeing myself from the stress of needing to work

I agree with the majority here that it could be a red flag. Check everything and don't leave anything to chance. A month-to-month lease at a premium may be a good idea. Sometimes people need to move quick and it's nothing, but you're better off making sure you are diligent about it. We just had someone who needed a rental quickly and moved in within 5 days or so, but it's because their house had burned down and the insurance is covering the rental for them. We got a check from the insurance company for security deposit, cleaning deposit, pro-rated December rent and full January rent. So it moved quick but we felt comfortable with everything.

I think all of the markets you listed are very competitive. Phoenix is extremely competitive, but that's because it's a hot market with a lot of deals.

I would figure out which area fits your budget/lifestyle the best and go from there.

I moved to Phoenix a little over a year ago from the Bay Area and I'll never look back personally.

Any house is a deal if you get it at the right price, have you been putting a lot of offers out there? Making $15-20k if you're buying cash is not unreasonable, most people make that on a deal using hard money.

Pull the cheapest houses in the areas you're looking at and start making offers. Explain your offers with comps and rehab estimates to support them. I guarantee you'll find something that'll work.

Also, remember you have to look at your annual ROI. Doing 6 deals in a year that make $10k each is better than waiting on 1 great deal that'll make you $40k. You'll paralyze yourself from indecision if you wait forever to do a deal.

Phoenix days on market are getting a little longer but prices still holding in most areas. Most flippers are factoring in another 2 months of holding costs and being a little more conservative on ARVs. Rehab properties still sell like hot cakes though and rents are going up a lot.

I had a flip in Glendale that wasn't moving and I didn't want to wait it out so refinancing and renting, should cash flow about $400/mo

I got a letter at one of my rentals from someone in my own office that I sit right next to lol

 Because wholesaling is extremely time consuming. A lot of wholesalers do 1-2 deals a month by themselves or with a partner but if you're taking several of the deals down yourself you're going to have a lot less time to source deals. I'm speaking to someone who has the means to take the deal down themselves, not the people who have no money who are just assigning the contract with $200 in earnest money as skin in the game

The very basics would be houses of similar size, similar bedrooms/bathrooms (Do not comp 1 baths to 2 baths, 2 beds to 3 beds), within 10 years of year built, within a half mile square radius, not crossing any major streets, that have sold within the last six months. Similar style as well and similar condition ie if I'm comping a house for a flip I'm looking at other houses that have been renovated in order to get ARV, I'm not using fixer upper comps to determine what the ARV is.

If you're in a lower inventory area where you can't find at least a few comps that meet this criteria then you can go 9 months to 12 months back. Always go back in time first, and then if you still can't find good comps you can widen your search a bit. Always work out slowly.

Then you have to look at anything that might not make you conforming. Do you back or side or are you on a busy road? You want to look for comps that also back/side/are on busy roads, and/or you need to make an adjustment of 10-20%+ to account for this. Do you have a converted garage? Look for properties that also have converted garages, or possible even comp it at the square footage you would be at if you re-converted back to a garage. If you don't have a pool, try to find comps that also don't have pools. Don't comp single story to two story/tri-level. Don't comp waterfront or golf course front to non water/golf front.

You'll never comp something to where everyone will agree. Some people will be more conservative, some will be more aggressive. As the wholesaler you'll be more likely to want to push the ARV higher because you're wanting to make a bigger fee or make a tight deal work. Conversely, the flipper is going to downplay the ARV as much as possible because they want to negotiate the best deal possible so that they can make the most money on the flip. Personally I try to shoot somewhere in the middle and also I'm looking at other factors like how well do I know the area, what's been the trend for that neighborhood, how many active homes for sale, what price are investors typically buying at in that area, etc. This is more for determining sales price than the actual comping but you see what I'm saying.