All Forum Posts by: Scott Rist

@Jameson Drew

Congrats on the deal!  I'm still curious has to how you found the deal.  DO you actively invest in this area?  Or do you look for deals all over the US?

I'm very interested in out of State investing and trying to find the best way to go about it.

Can you elaborate on that?  Thanks so much.

Scott Rist

Awesome post, JT. Many people have never lived or desired to live a simple life. I've lived it and desire to live it. Mine came from being raft guide (doesn't pay much) and traveling on shoestring. Greatest years of my life...so far.

Now my goals are simple, have enough income to comfortably support myself and a family while still living simply and traveling. This will be much more than a raft guide salary, but not Newport Beach either.  When I start getting extremely lofty goals I have to stop and ask myself "What the hell would I do with all that money?" The best answer I can come up with is to just give a bunch of it away.

I might have a different plan next week, but I always come back to wanting to live a simple, comfortable life.

CONGRATS!

@Bill Florence I agree with what you said, Bill.  If the price is right any deal makes sense.  I also love the quote "You can go broke buying great deals."  To me that just means KNOWING exactly what I'm getting myself into.  I generally plan for the worst and hopefully things turn out better.  Always a pleasant surprise to plan for a $5k fix and only spend $500.

@Jeff Rabinowitz I am actually eager to start ticking off these "Scary" issues, like foundations.  It will just take experience.  Actually something I need to talk to my Dad about.

We have also had a hoarder house.  It would have trumped any house you see on TV.  Beyond description.  We ended up moving everything out for the women and into storage.  We literally shoveled it into boxes.  That was a rough one.  Turned out beautiful though!

@Billy Au-Yeung SO was the house haunted?  Sounds creepy.  I've definitely been in some haunted feeling projects.  One of which I would not go into alone.  

@Jarred Sleeth really great point about what you are next to and how loud that could potentially be.  I will keep that in mind.  Especially a fire station.

@Julia Blythe Busy streets are always a big consideration.  It wouldn't be a total deal killer, but an obvious price reduction.  You basically rule out a large percentage of buyers right away.

Great thoughts everyone.  Anybody else??

Also, what did you think might be a big issue, but turned out to not be so bad?  Especially with the neighbor thing.  On one property, we actually trashed out the neighbors yard.  Did both of us a favor.  That, however, is NOT going to be the norm.  As most people have no interest in getting rid of there stuff.

I posted the other day about creating a more defined criteria for my flipping purchases.  I'm moving my business to a more metro area early next year and am trying to define my criteria better.  Where I am now is rural and we have adopted kind of a "take what you can get" attitude.

So with that, what types of properties, issues, characteristics, location, etc are big RED FLAGS for you.  What experiences have you had that have turned you off?

Someone in another post mentioned having that 6th sense for properties and when to walk aways.  I feel like that is definitely growing, but I still have a lot to learn.  

Also, some things might not be a guaranteed "NO" but maybe a combination of them would be.

Here is a list of the top of my head:

Unknown Pool issues.  This has been very hit or miss with us.  When you get to a vacant house with a Green pool its hard to say what lies beneath.  We have had simple drain and clean to complete overhauls/Fill ins.  In fact we just filled one in and depending on the county can be a major pain!  Not a deal breaker, but can make estimating difficult.

Really bad neighbors (hoarders, dogs, insane people):  One of the first things I look for.  Will scare away prospective buyers and almost always cause a headache during the rehab.  Unless it is a lower end neighborhood and it the norm.

Bad floor plans or bad additions  :  If it can be fixed in budget, OK.  But if it is a lost cause and can never really look "Right" I walk away.  You see a lot where I am with Owner/builder homes.

Major foundation/Structural damage: I just don't have a good eye for what it takes to fix these issues.  Maybe with more experience.  My Boss (DAD) has done major jobs before which have turned out well, but not where I'm at right now.

Flat Tar and Gravel Roofs:  Hard to find roofers who still do it and difficult to sell these properties.

Recent Death in the Property:  This was a minor issue we suspect in a job that just got in escrow after a bit of a wait.  The previous owner died of natural causes in the house.  We disclosed.  Guessing it turned some people away.  I would have a hard time doing a house that had a murder or suicide in it.  Thoughts??

Well I'm excited to hear your thoughts on what I put down and your personal WALK AWAY criteria.

Thanks,

Scott Rist

Mary,

I really appreciate your detailed response.  Almost everything you stated rings true for me.  If any others come up let me know!

Thanks again.

Thanks for the response, David.  I like the idea of only bringing the amount I'm willing to spend.  I usually don't get too caught up in the excitement, but I have gone over my set number.  hat usually comes with desperation to buy something.  That is NOT how I want to operate anymore.  

Do you, or others, set very specific criteria for the property characteristics?  Age, size, Bed/baths, etc.  Obviously, every area is going to have certain property types that sell better than others. 

A lot of my questions are simply going to have to wait till I have my feet on the ground where I am moving and access to the MLS to see what types of properties are selling best in different areas.

I want to niche down, but I don't want to OVERLY niche down!

Thanks,

Scott Rist

As the title says I'm working on putting together a flip criteria for myself and figuring out the type of properties I'm interested in and the type or issues that I walk away from.

We only buy our properties from auction/trustee sales and aren't able to be picky on the criteria.  Yes we still walk away from houses regularly, but it can be difficult as our inventory can be very small.  We work in more rural areas.

I am taking over the business from my Dad and planning to add a lot more ways of acquiring properties as well as moving into a more metro area (200k in the city and 450k in the county).  We have a lot of experience, but comparably speaking it is not ran like most flipping businesses.  With that, I would like to set a firm criteria for my purchases and not stray from that.  There is obviously fear there of "missing out" on deals, but I know this is what the most successful people are doing.  

I have created a Time/Risk to Profit chart for myself that I am happy with following based on what I know I want to make on certain types of jobs.  

What I am hoping to hear about is:

1. How you determined your criteria?  

2. How you determined your market/farm area?  Did you start with a small area, learn it, then add more areas?  What did that look like for you?

3. How strict are you, If an obvious great deals comes up out of your area do you go for it?  That is essentially all we do.  So we have become proficient in learning new areas quickly. 

4. What do you just walk away from even if the profit is there?

I have a solid idea of what I will walk away from every time such as; terrible floorplans I can't fix, major well issues, bad neighbors, poorly done additions, and severe structural/foundation issues (we've done them and not worth the stress).

5.  Any other tips?

I understand a lot of these questions will be "Well, it depends..." and what is in one persons comfort zone might not be in another's.  Just looking for some general ideas to help me put together my business plan a bit better.  

I look forward to your responses and experiences.

Scott

Yeah, Thanks for that article, @Kyle J..  That made things crystal clear.  

Appreciate the quick and accurate help everyone!

Great info guys.  Thanks for clearing this up.