The concept of house flipping is self-explanatory. Purchase a property and sell said property at a higher price to receive your profit. A list of experts in house flipping were asked by HouseFlippingHQ.com what their number one advice would be for someone looking to get started in the business. The experts consist of people who have been involved in the industry ranging from just a few years to several decades. These wide variety of ages allow you to have different viewpoints of the strategies.
• Mike Cantu of Upland, Ca. has been a full time real estate investor and real estate entrepreneur for over 30 years.
Mike’s Expert Advice: Educate yourself. Learn everything you can about the real estate business, with the emphasis on single family houses. Make it a goal to read everyday. For an hour. Every day. Go to local real estate clubs and continue your education. Find a good teacher. Someone who’s already accomplished what you’ve set out to do. Study them. Seeing is believing. What did they do right? Be willing to pay for good advice. Digest the new info, make a plan, and take lots of action. Everyday.
• Robert Fragoso is the Executive Vice President of Anchor Loans, a private financier for real estate investors based in Cerritos, CA.
Robert’s Expert Advice: Do it. It is a fantastic way to learn the business while making some money. However, I would strongly recommend that you network with as many people as possible who are already doing it as this will give you much of the experience that you will be lacking. Read the purchase contract and understand it fully as well as hone your skills on valuation. Much like a contractor must have his skill set and tools to do his job so must you in this business. Don’t rely on the agent trying to get you to purchase and the property comparable sales they provide but rather have your own tools in which you can double check the comparable. Network with others to see what is working today and also what pitfalls to stay away from. You don’t have to do it alone.
• Sharon Vornholt has been investing in real estate since 1998, and has been a full time real estate investor since January of 2008. She also owned and operated a successful home inspection company for 17 years.
Sharon’s Expert Advice: The most important piece of advice I could give someone is to join your local REIA and find a mentor. Learning from other experienced investors, having folks to bounce ideas off of and look at your deals will save you a lot of time, money and keep you from making costly mistakes that could be avoided.
• Nick Manfredi is a buy, fix & flip expert that focus’s on development of joint venture relationships. He’s President & Founder of the IE Investors Forum located in Southern California and CEO of The Manfredi Group.
Nick’s Expert Advice: Joint venture with someone who knows the business: it decreases risk, increases likelihood of earning a profit and should increase the time a beginner can focus on the art of buying property at a discount.
|Credit: House Flipping HQ (Bruce Norris)|
• Bruce Norris is an active investor, hard money lender, and real estate educator with over 30 years experience. Bruce has been involved in more than 2,000 real estate transactions as a buyer, seller, builder, and money partner.
Bruce’s Expert Advice: Every time you buy a wholesale deal, use the comp to get more deals. I call it “walking the comp.” I once bought a four plex out of the MLS for $60,000 worth $135,000. I took that comp and mailed all of the owners in the area a $60,000 offer; bought three more. Used those four comps to make offers to over-priced four-plexes in the MLS; bought two more. Used those six comps to buy 6 four plexes out of the Los Angeles Times. The man was a wholesaler who wanted $90,000 each, but took $60,000 when I showed him my comps. When I closed that deal, he was very happy and introduced me to a guy who sold notes at a discount. I bought a $240,000 note for $80,000 on an 8-unit building and a house. One comp turned into a lot of money very quickly. P.S. The comp doesn’t even have to be yours.
• Ward Hanigan is a full-time foreclosure specialist and trainer, located in San Diego County. He brings you over 30 years of real estate experience, with a degree in Economics and a Doctorate in Law.
Ward’s Expert Advice: You must develop an effective, comprehensive formula that calculates the most you’d be willing to pay for a property that meets your criteria, and will generate at least a minimally acceptable profit. For years my BEST BID formula was calculated manually, but nowadays it’s totally computerized.
• Roger Faulkner is the President/CEO and Co-Founder of RBD Ventures, Inc. a Redevelopment Company located in San Diego, California. RBD Ventures has bought, renovated and resold over 150 homes in the past three and half years.
Roger’s Expert Advice: Number one, get educated. I definitely recommend learning to wholesale something before trying a flip. If you can get the numbers correct for a wholesale and someone buys it then you will be able to do it for yourself as long as you don’t lose control of the rehab.
• Brian Daly and Patrick Clark have a unique background within the bank foreclosure industry, servicing one of the 4 major US banks as Asset Managers. In those positions they were responsible for the management and sale of over 2,500 foreclosed properties across the country over a 4 year period.
Brian and Patrick’s Expert Advice: Get out there and start trying to make things happen. Your business will never be perfect, and that first deal is an eye opening experience that is worth hundreds of hours of preparation.
|Credit: House Flipping HQ (Brian Daly and Patrick Clark on left)|
• Danny Johnson has been flipping houses in San Antonio, TX for over 10 years. His book ‘Flipping Houses Exposed‘ was a number one best seller on Amazon and is available for FREE. Read more about how to flip houses on his blog, FlippingJunkie.com (one of the most popular house flipping blogs).
Danny’s Expert Advice: You don’t need to be an expert in everything before starting to take action. Take baby steps. Educate yourself and then make a plan to do some marketing for deals. You don’t have to plan out every single possibility before getting started (that’s a surefire to never do anything).
• Tucker Merrihew is the Owner and Head Acquisitions & Finance Manager for TTM Development Company. He began his career in the Real Estate business back in 2002 as a Top Producing Mortgage loan officer, and then by 2004 he built his own Mortgage Company TTM Finance, LLC & Davis Financial which is still in operation today.
Tucker’s Expert Advice: Take action……most people that want to get into this great business just talk a big game and never actually take any action (or consistent action). Once you figure out what niche of real estate is a good fit for you to get started in, take action and make it happen. Remember fortune favors the bold, so get off your duff and start generating motivated seller leads and building your business.
• Ginger L. Macias, is an active wholesaler, rehabber, landlord, and educator. She founded OCWholesalers.com in 2008 which has been supplying investment properties at a discount to rehabbers, landlords, and end-users.
Ginger’s Expert Advice: If you really want to learn how to get started in real estate you just have to go out there and start making it happen! Stop taking the courses and studying and just start applying what you’ve learned. Pick up that phone and start calling sellers and making friends with agents. This business is all about making friends and helping each other out.
• Glenn Schwormand and his wife Amber are the owners of Signature Home Buyers, located in upstate New York. They have bought and sold over 100 houses and counting since beginning in 2008.
Glenn and Amber’s Expert Advice: I would tell them it is not overnight success even though the TV makes it look that way. A lot of hard work goes on behind the scenes so stay the course and plan to be in for the long haul. Longevity builds credibility if you operate with integrity and credibility can get you deals you would other wise never have access to.
|Credit: House Flipping HQ (Doug and Andrea Soest)|
• Doug and Andrea Soest have been in the industry since 2008, when they purchased their first flip property. Since then they have bought and sold over 150 properties and have acquired 40 rentals in southern California.
Doug and Andrea’s Expert Advice: If I had to narrow it down to one piece of advice for someone getting starting flipping houses, I would have to say…take action! Massive action! Your hopes and dreams are only as good as the effort you put into them to make them a reality. I’m not just talking about making an offer here or there, occasionally talking to an agent or two and then just hoping the deals just come to you. This is what most people do, and more often than not they fail. Then they wonder why they fail. Unfortunately, there’s no magic button to push to get a deal, it just takes work. Take massive action and do it consistently, over and over, every day. You will get results.
• As an Orange County Deputy Sheriff for nine years until 1997, Shawn Watkins learned the value of education, training and integrity. Shawn started investing in real estate in 1990 and spent several years buying, fixing and selling properties until he decided to buy and hold as many properties as he could in 2008.
Shawn’s Expert Advice: My number one piece of advice for a house flipper/wholesaler would be to set goals. I know this is said all the time by others but let me elaborate. When you set these goals they need to have a time frame attached to them. One goal I ALWAYS keep in mind is to write ONE offer each day. This is easy to keep track of because at the end of the day I either hit my goal or I did not. By writing an offer every day I am also getting feedback from sellers or my wholesale buyers list on WHAT they want and HOW MUCH they are willing to sell for or buy for.
• Darrell Kucan & Imran Clark are well known and respected in San Diego, but few know how vastly disparaging their lives once were. While Darrell was on a career path as a maintenance supervisor in Oregon, Dr. Imran Clark was working as a Senior Scientist in the Biotech industry.
Kucan & Clark’s Expert Advice: Get a mentor for Real Estate and another mentor for Personal Development.
|Credit: House Flipping HQ (Darrell Kucan & Imran Clark)|
•Tony Alvarez has been a successful Real Estate Investor and Certified General Appraiser in Southern California since 1981.
Tony’s Expert Advice: Buy something!!! I understand that is easier said than done… but, that one decision is the MOST crucial for someone just starting out because it cleaves YOU from the “wannabe real estate investor” existence you presently live in, into one clear distinction- YOU’RE A PLAYER! I can’t even begin to tell you the many people I have seen attend investor clubs, classes, seminars for years and have yet to buy their first deal.
The bottom line worst case scenario you can imagine will probably never happen, but one things for sure- Before you can do something really well, you’re going to do it wrong, but before you earn the right to do it wrong, you have to actually DO SOMETHING!
Now, that being said, the truth is there is so much to learn and do that boiling it down to just one piece of advice is pretty tough. I suppose I could tell you it’s all about something very practical like staying focused on BUYING; that it’s ALL about chasing & harpooning your “next deal”. Or make sure to secure your financing before you start making offers, or your Exit Strategies; so lock up your buyers and make sure you have a solid buyers list to quickly sell your stuff to, or always have more than one source for finding deals, or understand that you MUST have a specific Goal- Plan & and an underlining set of SYSTEMS; action steps you will take DAILY to feed this BUYING & SELLING machine you are about to create. Because as we all know TIME is your most valuable resource and a day gone by without actions culminating in results is a day lost, PERIOD!
I suppose on a deeper level, the rock bottom most vital piece of advice is something that on the surface may seem more like some esoteric teaching from the real estate Buddha… “Know thyself …” I would Tell you to be sure you understand exactly WHY you want to get into this business to begin with.
The truth is most everyone thinks they want “IN” for the simple reason of “I want to make more money” and that’s understandable, but behind that seemingly sensible logical reason lies something much more detailed and meaningful; a deeper reason, some longing to be free from some imagined unwanted situation or to simply reach some level of financial freedom that will provide you and those you love and care for with a safer and superior lifestyle to the one you might imagine you have at the present. Knowing, having a CLEAR understanding of the “WHY” behind your decisions is vitally important to your ultimate success, because it is the only STEAM behind your commitment to KEEP going the moment you hit the first of MANY obstacles that you will encounter on this road that will surely deliver you to exactly the place you imagine it can.
• In 1999 Kristi Cirtwill purchased her first investment property, a single family home with a basement apartment that needed major remodeling. Within 4 days of owning the property, she had the basement gutted. Then she called her dad and said, “Help! How do I put this back together?!” And that began the start of her rehabbing business. Her team is made up of business partner Evan Younger and full time office assistant Irene Duarte.
Kristi’s Expert Advice: The best piece of advice I have for someone looking to get into flipping or wholesaling is to get good at learning 2 numbers: the rehab number and the ARV (after repair value). These 2 numbers are the most critical to know when learning if a property is a good deal or not.
• Larry and Janet French are the founders of SilverMoon Real Estate Buyersmand have over 20 years of experience in the Southern California real estate industry. They specialize in the Coachella Valley region of California and, in addition to buying property, also manage dozens of homes and provide management services to a select clientele. Larry and Janet are also the organizers and directors of the Coachella Valley Real Estate Investors Association.
Larry and Janet’s Expert Advice: Start your education about Real Estate Investing now. Avoid seminars that cost >$300 per day. There are great Real Estate Investing teachers out there that offer reasonably priced education. Attend as many local Real Estate Club meetings as you can and make a commitment to meet new people each time you attend. Ask the experienced people at the club which RE trainers they recommend.
|Credit: House Flipping HQ (Jason & Katherine Grote)|
• Jason & Katherine Grote, are co-owners ofIBuyAustinHouses.com, along with Jason’s parents. They have been involved in real estate for the past 10 years and are full time investors.
Jason and Katherine’s Expert Advice: Get educated!! I think there is a mindset, propagated by the many gurus peddling their “systems”, that real estate investing is an easy, get rich quick program. Being an investor is just like starting any business. It takes hard work, dedication, and education. Additionally, if wholesaling properties, it is extremely important to do your own marketing and find your own leads. Do not try to make your living as a wholesaler by relying on the MLS. Develop a marketing plan to get qualified leads that you can then offer up to a flipper.
• Kurtis and Cindy Squyres have been rehabbing/wholesaling houses over 16 years. Together, they have rehabbed or wholesaled several hundred homes and have been featured on Inside Edition, the front page of the Los Angeles Times, Investor’s Business Daily, Fox News, MSN Money, and several other national syndications.
Kurtis and Cindy’s Expert Advice: As a licensed broker, we have made at least several hundred thousand dollars more than we would have ever made without a license in our regular course of business as investors. You have full resources like the MLS (a MUST if you are serious) without having to sneak around using other people’s log ins. You can represent your own entity, wholesale them for assignment fees, and then collect a nice commission from the seller at close! Plain and simple, it gives you a lot more flexibility and versatility in the number of ways you can make money (there are four more ways but we don’t have time here).
The biggest objection I usually hear, “I don’t want the extra liability”. Let me address that in perhaps oversimplified fashion: In California, the Department of Real Estate (DRE) is the entity that rules over licensed real estate professionals. I think this is a misnomer. It should be called “Department of Real Estate Licensees” because the DRE has nothing to do with anyone that isn’t licensed. The DRE cannot sue you. They can’t get a judgment, levy, or garnish you. They can’t press charges. They can basically do ONE thing, take away your license. That’s it. (oh, that and you might not receive a Christmas card). They can suspend it, revoke it, or take it away until you pay a fine (like a ransom). So, if you break it down, YOUR BIGGEST LIABILITY OF HAVING YOUR LICENSE IS LOSING YOUR LICENSE, WHICH YOU WOULD NOT HAVE ANYWAY IF YOU CHOSE NOT TO HAVE IT BECAUSE OF THE LIABILITY, WHICH REALLY IS THAT YOU MIGHT LOSE YOUR LICENSE.
I am a strong believer that becoming a licensed real estate professional whether or not you ever intend to work in the capacity of a Realtor has far more benefits than not to your investing career.
Featured Image Credit: Pixabay (Public Domain Image)
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