I was wondering if people are having more of a challenge flipping homes in this current market.
Any feedback on what you can suggest to still be successful in this challenging market?
George,
Yes, it is a little more difficult to find buyers, but the great deals still fly off the shelves. I have adjusted my offer formula down to 60-65% minus repairs to compensate for this.
I think the key is finding out what your buyers are looking for, and how much they are willing to pay.
A lot of my buyers are looking for deeply discounted, cheap homes (under 100k), that they can hold as rentals. So, that is what I am going after.
Good luck,
Steph
With the drop in prices that many markest are experiencing this is actually a great time to buy. But, the kind of buyers that are in the market now are the kind that have the abilty to buy and hold. This may not be a great time for people to flip deals, but it’s a great time to acquire real estate for long term holds.
So you need to start looking for people that fit that mold. I would be contacting people that own rentals already. I would be gearing my marketing towards investors that are looking for long term holds.
George – I think one can definitely profit from flipping homes, in this market or in any market. It’s really just a matter of spending the additional time up front to calculate, as best as possible, what you’re getting into. As they always say “you make your money when you buy, and realize that gain when you sell.” It still applies here, but now there’s five-fold more deals out there. The one thing that changes in this market versus others is the carrying costs, because it takes a lot longer to sell right now. Build that into your purchase decision, and you’re golden.
I’m an Article Contributor to a real estate investing community website, and I wrote an article on just this topic, entitled “How to still make money in real estate” – you can check it out here if you’d like. Also, if you’re looking more into just investing in this market, versus specifically flipping properties, you should check out another article on the site (I didn’t write this one, but I think it might be helpful for you) entitled “How to invest in real estate in a market downturn.”
Good luck!!
I wrote some articles on my blog as well, but don’t need post here. I’ll check with my fellow admins to see what they think about posting links to articles people have written. It seems helpful, but can get out of hand.
Anyway, I did an interview with Millionaire Systems that posted last week. They wrote Millionaire Real Estate Investor and Flip, both of which are best sellers. We talked about how to invest in the various markets. http://millionairesystems.com/pages/emailnewsletters/mm/MM101507.htm
I don’t make any money from the interview, so don’t think I’m affiliated except I try to provide advice to investors. Basically, in a buyer’s market, you’d buy even better so you can price 10% or so below “market”. Remember to evaluate listed properties in addition to solds to see what your competition is.
Well hey, I think that helpful, on-point articles written by seasoned real estate investors (for free) is a great resource. I can’t see how that can get out of hand in the slightest. Do a simple google search for real estate related advice and 99% of what you get is total crap. I’m assuming, considering your moderator status, that it’s been some time since you’ve been a newbie investor, but trust me, it’s frustrating to seek out good advice without having to buy one of the hundreds of useless books at the bookstore. That’s why I love this forum – it’s full of such things as great advice and been-there-done-that insight.
And, personally, I’d love to see some of the articles you’ve written. Why wouldn’t you share them with the community? I haven’t visited your blog, nor do I have time to, so I think it would be greatly beneficial to all the members if you posted some of your articles in relevant strings. Honestly, when I read a post in response to a question of mine from someone that seems to have a solid grasp on the issue, I can’t read enough. I always wish there was more. Maybe I’m different, but I thought a quest for knowledge and basic natural curiosity was a trademark of a successful real estate investor.
Either way, I appreciate your input, DeeinAustin. I think this forum is excellent, so you and your fellow moderators are doing an excellent job. Keep it up.
There is an area of the site devoted to articles:
http://www.reiclub.com/real-estate-articles.php
You are not supposed to link to your own site or to sites that you have a financial tie with…
Keith
Ok, that’s good, because I’m linking to a site that I neither own nor am financially linked to. boozwatt.com is an investing community startup comprised of a collaboration of real estate investors, economists, realtors and real estate lawyers sharing the common goal of “fixing” the current real estate market by providing information and insight in the hopes of making a smarter investing community. I simply donate my time and expertise, as the real estate lawyer, to the site. I’ve read your rules (I’m a lawyer, it’s what I do) and I don’t see how I’m violating any of them. I’m not advertising any services or offerings, I’m not using “profanity or name calling,” I’m not networking, and I’m “answering only informational questions specifically related to real estate investing.” I doubt anyone can refute that I haven’t run afoul of any of your rules regarding posting.
In fact, half the articles I’ve linked to I haven’t even written. I’ve just found them helpful to the ultimate question being asked in that particular post string. If they were irrelevant to the post, or could be construed as spam in some way, I could understand. But they’re not. I run a RE investing firm in addition to my legal practice, and we have all our new employees read these articles - we find them to be that helpful.
Keith, as the global moderator I think you’ve done an excellent job running this forum. Like I said above in response to DeeinAustin, I really enjoy this forum because it allows investors to ask and answer questions, thus collectively benefiting the greater good as every member can share in the expertise and experience of the others. If you don’t want me linking to free, helpful and relevant articles because it might take traffic away from your site, then say so. I won’t anymore. I’ll continue to post, but I won’t refer people to any articles. I was just trying to help in a way that I wish people would have helped me back when I started investing in real estate. I hope you can understand.
If I were in your shoes I would not “flip homes” if by flip you mean buy with the intention of selling later after rehab. If by flip you mean flip contracts, then I would recommend doing that in any market at anytime if you have your ducks in a row.
I have adjusted my offer formula down to 60-65% minus repairs to compensate for this.
Give me an example of this sentence. Like if a house was worth 100,000 and they were very motivated. Say it needed 10,000 in repairs. What would your offer be
50k-55k…if it would actually sell for 100k