All Forum Posts by: Wes Blackwell

Hey @Harry Case! Great question!

The internet and TV has lead to the massive spread of information regarding real estate investing in the last 5-10 years. With TV shows like Flip or Flop, Flip This House, and Property Brothers more and more people are convincing themselves that they can rehab a property. This has lead to increased competition for deals, naturally for higher prices. Looking for deals on the MLS as a wholesaler is going to be a complete waste of your time. Even as a rehabber.

In order to find success nowadays, you have to be willing to go the extra mile and do what other wholesalers won't. That's the only way to spread yourself from the pack. Here are a few examples that I can think of:

1. Preforeclosures: There are roughly 200 preforeclosures per month in Sacramento County. This gives you more leads than you can likely handle, especially if you go back and pull all the people who defaulted last month and the month before that. Go straight to the owner's house and knock on the door. Foreclosure usually happens because of death, illness, job loss or divorce and cripples the homeowner's ability to make mortgage payments. They might be in a tight bind and be willing to sell the property below market value, and you can make your money in between.
2. Vacant/Non-Owner Occupied: If a home is sitting vacant the owner may be willing to sell it quickly just to get rid of it. They could have moved away, inherited, or just not care about it anymore or aren't willing to rent it. You can door knock with these too (but you'll have to do it at the tax mailing address) or you could simply send a letter. At that point it's merely a numbers game. Talk to enough homeowners and you'll soon find someone willing to sell at a wholesale price, especially if the owner lives out of state.
3. Driving for Dollars: The last method is to simply drive around and look for homes in disrepair... things like uncut grass, broken down cars in the driveway, or properties that could really use a fresh coat of paint. These indicate that the owner doesn't have the money to fix these problems, and that might mean they are in a situation where selling their home might solve a lot of money problems for them. You can either send them a letter, or go up and knock.

Now, you may or may not have been aware of all these strategies, but what's really important is that the point I'm emphasizing is HUSTLE. Not that you aren't doing that already, I don't know, but what I do know is that doing the above activities 40 hours a week will practically guarantee you success. 

While other wholesalers are relaxing at home and waiting for a deal to fall into their lap, you'll be out making things happen. I'm a firm believer that if you want success, you have to go out and get it, and the only real way I see having success with wholesaling nowadays is to get out their and meet property seller's face-to-face.

Well, they are selling their current owner occupied home, which will give them roughly $300k to work with towards development. If they split off the home on that acreage and sold it they might add another $225k or so. So your idea is possible...

But, my client is in their 80's, and so it might be simply too much to take on for them. Plus timing is a concern, as that may simply take too long.

It might just be better to sell the property as is and 1031 exchange it into a new rental in the Rocklin / Roseville area where they are moving too. Their main concern is leaving something to their children, not maximizing profits for building their own future.

I estimate the property is worth approx. $300-325k as is. There are several homes nearby built in 2005-2008 in that sold for $350-400k... 2,200-2,600 sq ft on .15 acre lots. Another home sold nearby that was built in 2015 for $560k on a half acre. So there's lot of options...

I'll be speaking with a builder tomorrow about the possibilities and post their thoughts here. 

I have a client who owns 1.15 acres of land that was previously approved by the city for 5 additional lots. Although, the timing on the permits has passed, and they would need to be applied for again. But they did have an engineer draw up some plans for them already, and they still have them.

There is currently a 2/1 house on the property that's 1,300 sq ft and was built in 1948. It's dated, but clean and extremely well kept. With a little renovation and updating it'd really shine. The median home value for the zip code is $270k, but a new home around 1,500 sq ft could easily demand over $300-325k+.

My client wants to sell the property in the most profitable way possible. There seem to be several ways we can approach this:

• Sell the property as-is
• Split the lots and sell them individually
• Possible joint-venture with builder / developer
• Client does not have funds to develop property themselves

We're currently trying to determine what's the best way to market this property, so it is currently off-market. I'd love to hear some thoughts from local contractors and land-developers since you'll have a better grasp on pricing and process than a developer out of state.

Even if you're not interested in purchasing it or developing it, I'd love to simply talk shop and hear your thoughts or analysis on the project.

I have a client who owns 1.15 acres of land that was previously approved by the city for 5 additional lots. Although, the timing on the permits has passed, and they would need to be applied for again. But they did have an engineer draw up some plans for them already, and they still have them.

There is currently a 2/1 house on the property that's 1,300 sq ft and was built in 1948. It's dated, but clean and extremely well kept. With a little renovation and updating it'd really shine. The median home value for the zip code is $270k.

My client wants to sell the property in the most profitable way possible. There seem to be several ways we can approach this:

• Sell the property as-is
• Split the lots and sell them individually
• Possible joint-venture with builder / developer
• Client does not have funds to develop property themselves

I wanted to get some opinions from experienced land developers on how you think we should proceed or what the best course of action would be. And if you know someone in the Sacramento area who might be interested, please let me know. Thanks so much for your help.

Hey @Cemone Cowart! Welcome to Bigger Pockets! You've come to the right place!

And you're 100% right, the Bay Area is CRAZY expensive right now, and between you and your fiance it sounds like you may have the resources to take on your first flip!

Some pieces of advice:

First, check out the book written and presented by Bigger Pockets and J Scott on flipping houses. It will give you a big head start and get you going in the right direction. Also check out this guide to flipping houses with no money, as that will share with you some tips to save on your expenses in completing the remodel. This site has also recorded over 200 podcasts on all sorts of topics regarding real estate investing, and you're sure to find some tips for flipping houses in there as well.

Second, you're going to want to build your team of real estate professionals to help you succeed. You'll need a investor-savvy agent who understands your real estate goals, a mortgage lender or broker to help you arrange your financing, and you'll probably want to meet and grab coffee with a couple other local real estate investors and learn from them. They may even have the perfect property for you too!

Lastly, here's some stats on some of the local markets you mentioned: Manteca has a median price of $360k and Tracy's is much higher at $430k. If you could make the commute from Stockton you'd be able to get in at a lower price ($250k) but the challenge there is finding a property that has enough upside potential as you can only go so high. Won't be a problem in Tracy or Manteca though with higher home values. You just need to find a property at the right price!

I'm a Realtor who's familiar with the areas you mentioned and specializes in working with investors (been involved in plenty of flips myself) and if you'd ever like to grab coffee and talk about your investing plans I'd love to hear more about what you plan to do. Best of luck!

Hey @Alester Thomas! Welcome to Bigger Pockets! You've come to the right place!

As an agent who specializes in help real estate investors, I can certainly tell you there are cash flow deals to be found all around the Sacramento area. I'm currently working with 4-5 other clients who are looking to achieve the same thing you are.

Most important thing for you to do now is network, build your team, and soak up information like a sponge. @Jay DeCima is right... a mentor or two can really cut the learning curve for you and help you avoid some costly mistakes. You'll find plenty of people here learn from and make sure you get started on the right foot.

The creators of Bigger Pockets have actually written a book on rental property investing, and I highly recommend it as a great place to start and build up your knowledge. Don't get suckered into any $40,000 boot camps just yet... learn as much as you can from this site, others like it, and the local library or book store before you get started.

If you'd ever like to meet up and talk shop or just grab some coffee, I'd love to hear more about what types of properties you're looking for and what your goals are over the next few years. Best of luck to you my friend!

Hey @Sandra Reed! Great question!

While some other investors and lenders will certainly chime in, I know there's a group on Meetup.com specifically for private money lenders. It's run by an investor I know who's done over 100 deals, so you'll certainly find some great resources there for potential lenders. Best of luck!

Hey @Jake Leicht! Nice to meet you!

I'll definitely keep you in mind, as sometimes I come across distressed sellers who are in a bit of a hurry to close and being able to deliver a cash offer within 24-48 can sometimes really help!

@Yia Her -- I'm extremely experienced with preforeclosures. I'm from Stockton, CA and as you may know that was the foreclosure capital of the nation during the 07-08 crash so that's practically all there was. So I've earned my stripes for sure, and have purchased rehab properties that way as well as obtained listings from them.

What people have to realize about preforeclosures and distressed sellers is that it's not the typical sale. And what I mean is that it's not a "Happy Sale." Normally, sellers are either selling to cash in on equity, move to a better neighborhood, or even a new city via a promotion or job transfer. They are generally happy to sell their home and make the exciting move.

Preforeclosures on the other hand ARE NOT happy sales... not by a long shot. Usually it's due to either death, illness, job loss, or divorce and the sellers are devastated to lose their home on top of everything else they're losing. It takes an extreme level of emotional intelligence and a sense of compassion to work with these sellers. But it can certainly be done. I'm living proof.

As far as negotiations go, it's best to either hire a third party or work with someone who has their flipping system down pat and mastered to perfection. Once you get several under your belt you'll start to see their negotiating process and can work towards handling it on your own.

I'd love to meet and grab coffee sometime! I'm showing 11 homes today to a couple clients and we're already saddled with Thanksgiving this week, but perhaps this weekend we can find time to meet and talk shop :-)

Hi @Peter Stephan! Welcome to BiggerPockets! You're in the right place!

I'm a Realtor in the Sacramento area who specializes in working with investors, and I can tell you there is much opportunity to be had here! Rents in Sacramento continue to rise, along with housing prices, so we're still probably several years off from the peak. That means cash flow and growing equity are ripe for the taking.

Perhaps some fellow investors and agents from the Bay Area will chime in, but I probably wouldn't advise starting out in such a high priced area if this is your first rental. Not only will it take more capital to work with, the prices are so high you might not be able to make the cash flow work.

Plus, the area is much more susceptible to a housing bubble, and while people will have their arguments about that, I wouldn't advise a new investor to get tangled up in the possible risk when you can make it work elsewhere for much cheaper.