Flipping Properties
How can I find a good realtor with experience in flipping investment properties in Houston?
My husband and I are on the verge of tackling our first house flip but need to build up a team of reliable and experienced professionals to call on — a leading person in this group is obviously a good realtor. The agent who sold us our first (and current) home is nice enough but SUCH a naysayer on investment properties. So she is out! How can I track down someone who is proven, efficient, and worth their commission?
What do you think a good realtor will do for you in finding properties for you to flip? Realtors are too hung up on keeping their fudiciary responsibilities in tact than assisting their clients in selling their property even if it is going into foreclosure and their client will lose their home.
Look at the real estate agent that sold you your home when you asked her about investment properties and her attitude. Well that is about what you will encounter in other real estate agents.
You might find a need for one later, but for now you need a marketing plan to find properties that are in foreclosure, probate properties and other distressed properties.
You have to develop a system of finding the properties yourself, so you can have a consistent number each month or quarter or however you want to do them.
It is always a good idea to flip when you know what you are doing. In this regards you would normally select an area of your choice that is good for you to work and close to where you reside.
I would suggest that you go to your local book store and purchase a couple of books on foreclosures, distressed properties, and buying, rehabbing and flipping. You might also find several other books that you would like to purchase. You might also find a few listed in your public library.
You might also purchase one of the TV guru’s programs. In the program you will find several things of interest. You will find script to use on potential individuals that you would want to purchase their house. A slew of legal forms that you can use as well as a formula that will tell you if the property you are purchasing is gonna give you a profit or not and how to use the formula.
Their package will also tell you things you should look out for in your purchase as well as things to that you should beware of.
You should form yourself a professional team to assist you in your newly found career. This is a partial list that you might start with an attorney, real estate agent, a mortgage broker, a home insurance agent, a notary public, a title rep as well as an escrow closing agent. You might want to add or take away depending on how you feel.
You will also need to develop away to market yourself so you can have an unlimited amount of properties to buy and sell even in a slow market. I will list a couple of ways to accomplish this.
#1 Advertise in the local newspaper that you purchase foreclosures and other distressed properties.
#2 Purchase a foreclosure list from a list broker (Do a mailing campaign like everyone else)(You might also cold call off this list but you must beware of the no-call list)
#3 Select an area in your city to devote full time work in. Walk the area for about 2-3 weeks telling the folks outside their homes what you do pass out flyers out ling that you buy foreclosures and distressed properties as well as probates.
After 3-4 weeks of walking in the neighborhood, contact your title rep and ask for a farm package of the names of the people in your farm area. Now each month mail a newsletter to the names on your farm list.
This method should give you 1-2 housed per month to buy and flip, word of mouth will give you another 1-2.
That will keep you busy with enough to do and earn. You can always expand and you will as you learn more about your trade.
I hope this has been of some use to you, good luck.
“FIGHT ON”
Free Special Report: Flipping Properties
For years, hot-shot speculators made huge profits flipping condos in Florida and Vegas before they were even constructed. All the while, the naysayers in the ivory towers of Wall Street and academia warned of a “housing bubble” that was sure to burst as all bubbles do.
When Fed chairman Alan Greenspan said that national real estate market was “frothy,” the writing was really on the wall, and anyone with half a brain could see that we were in for a cooling of the housing market, at best. And yet still, speculators continued to profit, and the real estate bull market marched on.
But the bulls aren’t marching now. Greenspan handed his matador’s cape to the new Fed chairman, Ben Bernanke, who continued the policy of interest rate hikes designed to deflate housing. No longer accelerating at a break-neck pace, home prices have flattened like a pancake in many markets, and new the condo speculators who got in late are in for a world of hurt. Clearly, the housing boom is over in many parts of the Country. But contrary to the media hype, this is great news for flippers!
It should be made clear that there is a difference between flipping and speculating. While speculators may be a sub-set of flippers, they are, at best, the amateurs of the real estate investing family. Flippers who have consistent success are more conservative and have a fundamental approach to real estate investing. While it may not be as exciting as speculating, the rewards of more conservative flipping are nearly as generous, and they are paired with far less risk.
The biggest difference between flipping and speculating is that flipping works in any market, whereas speculating only works in certain places at certain times. Las Vegas from 2002 to 2004 was a great time and place to be a speculator, but if you were still in the market in 2006, chances are you got burned by more than the hot desert sun.
Basically, speculating often works on the greater fool thesis – that you can always find a greater fool than yourself to take a property off your hands in the expectation that he will be able to find yet a greater fool. Eventually, someone is left holding the bag and that’s when the party is over.
Flipping, by contrast, relies on fundamentals. The idea is not to catch a shooting star in a rapidly appreciating market. Rather, the plan is to find undervalued properties, rehab them, present them in an attractive manner, and sell them for a reasonable profit.
Not only is a rising market not a requirement of flipping success, it may even be a mild detriment! After all, it is a bit harder to find bargain properties in booming areas. Sure, it can still be done, but the point is that even falling markets are prime for flipping since the holding period is often too short for the value of the property to decline beyond the deep discount at which it is purchased. Assuming that you add value through rehabbing, you almost can’t lose!
While speculators often rely on the “greater fool” strategy, flippers tend to have one of two exit plans: 1) Quickly flip the title to another investor, or 2) Rehab and sell the property at the retail level. While the lion’s share of the profits go to the retailer, a quick wholesale deal can free up your cash (and energy) for the next deal. But what if neither strategy works? What if the market really crashes and the buyers disappear? Is all lost? Of course not!
For complex economic reasons, the rental property market does not always correlate with the housing market. In fact, they are often countercyclical. Although most flippers aren’t terribly interested in being landlords, generating rental income from a botched deal is a solid backup plan. Better yet, you can usually refinance the property after rehabbing it to get all of your money out.
From that point forward, the bulk of your rental income will be pure profit, and when the market improves, you can make the sale. Even better, you can offer your tenants a lease with an option to buy, which is attractive to many young families looking for their first home.
The media portrays real estate flippers as the investment world’s answer to Wild West gunslingers, but in reality, nothing could be further from the truth. Compare the worst case rental income scenario of real estate flipping with the worst case Enron scenario of stock market investing. There really is no comparison!
If you take a fundamental approach to real estate rehabbing and flipping, your risk is limited and your profits are virtually limitless. It really is the best of all worlds.
About the Author:
Richard Reichmann is internationally known as a millionaire maker. He’s a leading consultant in real estate and internet marketing strategies that are profit proven.
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Article Source: ArticlesBase.com – Flipping Properties Works In Any Market
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