hi to all im new to rei but have been studing up on it for about a year and i believe im now ready to make my first deal. i found a hard money lender near the city i live and was just wondering if any of you guys have done a rehab as your first re deal? if so you had any problems? thanks i would really appreciate any comments.
Good to meet you and welcome to the board…
You may consider staying away from a rehab on your first few deals… Thats one way to make a quick exit from the investing business. If you haven’t spent endless hours learning cost evaluation for repairs then youre setting yourself up a little…
Start with the traditional flip which needs minor if any repair… Then as you learn and gain experience, which cant be learned in a book, then you can move on to more difficult higher profit transactions…
JMO
Michael
Sound advice, I am very new in flipping properties myself and that question and answer was very helpful. Thanks
Good to meet you…
Glad to see some flippers here
Happy house hunting
Michael
I agree with Michael,
In addition to needing to know the cost of repairs, you also need to get you a good contracting crew that you trust.
This is crucial in rehabbing because in this business you really “get what you pay for”. You don’t want to hire someone too cheap and get a lowsy job and you don’t want to hire someone too expensive and still get a lowsy job.
A lot comes with mild to total rehabs. Start with something habitable that only needs cosmetic work like new baths, carpet and paint and new “knick Knacks” (light fixtures, cover plates, etc).
Get your feet wet a little and then go for the gusto!
Learn the business first via wholealing?
Make your mistakes in this area where you are only risking $100 in earnest money.
Through wholesaling , you’ll learn what a deal really is supposed to look like and you’ll be able to estimate repairs through getting bids as well as your own experience with it.
If your numbers are off, your rehabber investors will let you know, but then you have only risked so little.
Do a few wholesale deals first correctly then move on.
You’ll learn negotiation, contracts, estimation of repairs as well as the entire closing process through wholesaling.
AFter wholesaling stick with ‘fixers’ only. These are houses with minor, cosmetic repairs needed. No levelling, roof, electrical (major).
Dennis