I have started a new LLC for rehabbing/flipping homes and I’m in the process of writing a business plan/market analysis.
Can anyone help me find statistics on rehabbing and flipping homes in the Albuquerque area?
Thanks!
I don’t think the kind of data you’re looking for is available.
I think I’d go the more direct route and just talk to investors and investor-oriented Realtors and just take a temperature check that way.
If I were you, I would not over-analyze this. While the pulse of the market is something you need your finger on, you still need to look at each deal on its own. Even if the worst, slowest-moving markets, there are ways to make money if you are buying property right.
If you know that homes in “X” neighborhood are selling for “Y” dollars and take “Z” months to sell, then you should be able to figure out how much you can pay for a house in that neighborhood, how much it would cost to renovate, and how much profit you can hope to make if you have to hold it for so long.
If you can’t find a good deal, don’t buy a house.
Thanks for the great advise Paul. I was just hoping to get as much specific info as possible to polyrazmataz the bank.
As a former commercial banker, I’ll say that I would be surprised to hear that your potential lenders will be at all interested in your business plan.
You’re going to be looking for real estate loans, so they only things they are likely to care about are your finances, your credit, and the property. It’s not like you’re asking for a line of credit to support receivables or inventory or a term loan for a new widget-making machine.
Your loans are going to be asset- and deal-specific, so while a business plan might make a lender feel more comfortable with the idea that you’re taking this seriously, I would really be surprised to learn that it makes any difference at all when seeking a loan.
It’s all going to come down to the deal’s numbers.
That’s what I was thinking - nice to here someone confirm it though. I like to stack-the-deck in my favor as much as possible - but I do have a tendency of over-doing-it at times.
A good business plan will help you get private money. Traditional and hard money lenders look at the deal. Private money invests in you.