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Old 08-10-2015, 01:39 PM   #41
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That was my whole point of the thread. Right now, remodeled houses are selling quickly. Twice I asked if people thought the fact that we could live in the house with very little disruption to our lives significantly mitigated our risk if we couldn't sell the house quickly when it was done.
I believe you can do this, if you're willing to accept a longer time-frame. I watched the house next door go from nuisance to new family in about 3 months. The previous owner did not live there, but did come to take care of certain things.

A team of contractors, who work together (one told me the story) several times a year, did the job in two months. HVAC, siding, kitchen and flooring contractors worked on the house. A shifty individual with the cash to pay them performed as the GC. They had an inside track with R.E. agents.

GC or someone bought the home for $194. Paid the previous owner some additional amount of cash that wasn't recorded. A couple purchased the home for $324, but the sale has not shown up yet on public records. The asking price was a little higher.

I think this would take an inexperienced flipper about a year.
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Old 08-10-2015, 01:42 PM   #42
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I am not one who would say that someone else would have done it... because from what you say it is not on the market...


I just wonder WHY you would want to do this... unless one of your hobbies is painting walls... or hanging cabinets... or laying floors (which you say you DW will do).... or all the other items that have to be done... then it is work..

Now, I am doing some work on my house... doing the deck.... but I have not touched it in the last 3 weeks as the temp is over 100 almost every day... I am waiting for it to get cool... I have the luxury of time... in a flip you do not... well, at least not for free...

IMO, this is either going to be a hobby for you.... and you have to figure out if there is a black hole possibility or it is work... it seems you know more about flipping than most... and if you have watched all those shows (even if staged) they tell you enough for you to know the big gottchas....

The one thing I would look into is the permits... some places are really bad... at the end of my career with mega I was in the real estate group that did construction all of the country.... there were some places that took a year to get a permit to build... and others were VERY strict in what you put down.... we had one place that required 4 inch trees... the contractor put in 3.5 inch.... we were told to take out the 40 to 50 trees and put in the right size... cost 10s of thousands....
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Old 08-10-2015, 02:01 PM   #43
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With Florida being a judicial foreclosure state, I guess the backlog has taken some time to process and release properties for sale. They are apparently trying to speed it up, if you are located here:
http://www.dailybusinessreview.com/i...20150710143400

This foreclosed inventory would find it's way on the market faster in a non judicial state, assuming the lenders wanted to move. That would weaken prices some. I would guess the courts are the bottleneck instead of a lack of flippers. Or maybe bank financing is hard to obtain for rehabs. That would clear the deck for some cash buyers.
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Old 08-10-2015, 04:35 PM   #44
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A property with an estimate of $40k flip profit is not enough to bother with IMHO. You might look for properties with more potential upside ($100k or more). Otherwise the downside risk is too great.
+1, agree. $40K flip not enough.

You should ask a friend who has done flips for advice. You should know in
advance, What it will cost to fix up, What house will sell for, and your net
profit.

Break even, and figuring your labor is "free", is bad business.
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Old 08-10-2015, 05:49 PM   #45
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A property with an estimate of $40k flip profit is not enough to bother with IMHO. You might look for properties with more potential upside ($100k or more). Otherwise the downside risk is too great.


Wow... missed this when reading earlier... saw it in a quote...

Do you do flips? I just do not see a bank leaving that much meat on the bone for a flipper... I would be in the 'someone else will do it' camp if there were that much upside to a flip...

The guy who bought my mom's house (the we buy ugly houses) planned a $10K to $15K profit... showed me his numbers... he had done many of them... now, the house after work sold for less than the profit you want...


I think $40K is a good profit... I also think that personal time and effort should be factored in... HOWEVER, I have a sister who knows someone who loves upgrading houses and then selling them.... they buy a house that is not bad.... do the upgrades while living in it... after a few years of projects they sell and move somewhere else... she loves doing it and does not factor in any of her time... it is her hobby...
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Old 08-11-2015, 08:17 AM   #46
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The best way to get in on flips, is to understand the foreclosure process. Know how to get a lien on a property, know what lien priority is. Know how to extinguish liens. Know how to redeem property.

Join a RE investment club. Get educated. Get to know bird doggers. Get on RE investor mailing lists.

I just did a flip in 2014. Here are some brief detail.

New construction in 2005 price was $245K (the owner had a 80/20 loan)

Redeem from Sheriff in Nov 2013 - $128K Cash
Sold to new owner in Jan 2014 - $200K Cash

Total expenses were ~$15K and some labor, which included giving the owner $4K to make the deal. Total hours, 80. New paint, carpet and some appliances. Fixed a bunch of small items and cleaned like crazy. Total holding time, less than 3 months. Purchase to MLS time was ~3 weeks.

Profit ~$57K. If I would have waited for the MLS (or a realtor), it would not have been a deal. Or if the second mortgage get their $60K+ lien extinguished, it would not have been worthwhile. If I could not get a third lien position, it would not have possible.


Another one, that i still own. I purchased the mortgage from the foreclosing bank.
Purchase price was 197K cash (4-plex)
Fix up costs ~$60K, plus lots of labor
Annual rents are $53,340 with room to grow (of course no mortgage)
One similar that just sold, with less amenities, $355K (cash deal, 2 days on market)

There are lots of ways to make money with flips and RE, retail (i.e. MLS) is generally not one of the best.
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Old 08-11-2015, 08:48 AM   #47
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In 2009, picking up deals on the MLS was easy. The banks were dumping properties as fast as they could. I bought four houses between 2009 and 2012 for $65-$74,000, all short sales that had fallen through at the last minute or foreclosures. They were in good shape, needing minimal repairs. They rent for $900-$950 and would now sell to first time homebuyers for $150,000.


Inventory on the Maricopa County (Phoenix) MLS is less than a third of what it was in late 2009 through 2010. What few foreclosures appear on the MLS are priced at market value and banks won't deal. Fannie puts in paint and carpet at their properties and prices them high. There are bogus "auctions" where the properties sell to unknowledgeable buyers at or close to market with the premiums added in.


I get solicitations every day from graduates of the classes given by the latest guru passing through town. Wall Street grads have gotten into the flipping business via Opendoor.com. Their solicitations are just a little more sophisticated.


There has never been a more efficient real estate market that the current one, at least in Phoenix.
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Old 08-13-2015, 01:01 PM   #48
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Building Detroit - Neighbors Wanted

There is always Detroit to pick up a few fixer uppers.
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Old 08-13-2015, 01:45 PM   #49
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My understanding (which could be out of date) is that Florida is a judicial foreclosure state - so the time to foreclose is longer than in other states.... Every foreclosure goes to court and a judge.

Here in CA it's usually an auction - have cash on the courthouse steps and you can walk away with a house for a decent price (unless other flippers have deeper cash pockets.)
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Old 08-13-2015, 02:08 PM   #50
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My understanding (which could be out of date) is that Florida is a judicial foreclosure state - so the time to foreclose is longer than in other states.... Every foreclosure goes to court and a judge.

Here in CA it's usually an auction - have cash on the courthouse steps and you can walk away with a house for a decent price (unless other flippers have deeper cash pockets.)

Unless there is a good sized mtg.... most banks will bid up to the loan amt...
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