Rehabbing Tip$…..Episode #2

Back by popular demand…..here is the second video in our series on how to make HUGE profits Reahbbing Houses! Have any of your watched The Vanilla Ice Project?  Well I can admit I have put myself through the pain and agony a couple times just to see what he has going on….but one thing I have to say is that he does pay attention to some of the important aspects of the rehab process, that also happen to be the topic of this post.

Right now the market is the best I have ever seen for those of us who make a living rehabbing houses! There are plenty of sellers out there who are willing to sell their houses at a deal, and now with the recent changes in the market there are retail buyers lining up to buy a quality renovated house to live in. Buyers have been sitting on there hands for the last few years waiting for the market to bottom…..and it appears they have been waiting long enough and are starting to come back into the market in HUGE numbers. So what does this mean to those of us rehabbing houses? Well it means we need to capitalize on this demand and sell them some damn houses!!

Now onto the topic of this second video in our series on rehabbing houses for BIG profits….this episode is all about the quality of your rehab product. A lot of investors put all of their focus on the investment side of the business, which consists of working on acquisitions, ARV, REI Club meetings, ect…..now don’t get me wrong these are are necessary parts of your success as a real estate investor, but one area most investors decide not to continue to educate themselves on is Construction & Design! I can’t tell you how many rehabs I have toured that other investors have done ( that they are incredibly proud of by the way) and I have just cringed as I walk through the entire house. The reason being is because they relied on what was on “blue light special” down at the home depot for their surfaces in the house. Just because tile, paint or flooring is on sale doesn’t mean you should be buying it for your projects!! Generally there is a reason why nobody else has bought it and the product is on the sale rack.

Next please don’t rely and your general contractor for design selections!! Just because they know construction doesn’t mean they have a clue about quality design…..so take the time to learn everything you can or at least hire the assistance of a good designer to help you pick out your finishes (at first anyway). Once you get a number of quality houses under your belt then you will get a good idea of what looks good and looks not so good…..So check out the video and remember to never stop learning about all aspects of real estate!

Check Out Our New Series All About “Rehabbing Tips”!

Unless you have been living under a rock lately you know the Real Estate market is starting to change for the better…..and its not just isolated to a couple markets around the country…...its happening everywhere!! So what does this mean for those of us making a living flipping houses? Well it means A LOT more people are going to start jumping into the house flipping game, and more specifically the rehabbing side of the business. So its time to step your game up and learn everything you can about creating the best rehabbed product possible, that way your projects stand out from your competition! The truth is most investors do an “OK” job at best when it comes to rehabbing their houses…..and the only way to go from being “OK” to being being Great is to keep learning everything you can about construction & design at all times!

So in an effort to help you step up your game and become the best rehabber in your respective markets, I have decided to start this series dedicated to providing you all of my closely guarded rehabbing secrets! With doing over 100 rehabs just over the past 3 years alone, I have a ton of great tips to help you do better rehabs and sell your houses faster…..so check out the first video in this great series!

We will be releasing 1 video a week over the next couple months, so sign up for our newsletter if you haven’t already so that you can be notified when they are released! Now get our there and put this tip to work in your business…..

What’s The Biggest Opportunity Out There For Rehabbers Right Now?

Over the last year I have seen a lot of changes in the Real Estate market….in fact I would say dynamic would be the only real way to describe it. With all of the changes along with what appears to be a rather dramatic improvement in the real estate market over the last couple months, there is one niche of house flipping that is very obviously the biggest opportunity right now! Now I took a risk on this niche within my own business starting in mid 2010……and surprisingly at that point in the market it paid off big time, so we have been focusing very heavily on this niche ever sine. However now that the market is starting to improve it appears that other investors are starting to catch on to what we have know for pretty much the last year couple years. So what is this great opportunity you ask????

Well its flipping high end houses!! Now just to be straight up and truthful about this niche, it absolutely has much larger barriers of entry (mainly capital and know how) than entry level flips, which prevents a lot of would be competition from getting into the high end market….but those who have joined us in the niche of high end house flipping have been quietly making an absolute killing as of late! Once you get to a point in your real estate investing career where you have built a strong business foundation and are looking to expand your income…..you have choices on how you can go about doing it. One of those choices is whether you want to do more entry level rehabs in order to generate more profits, or do less overall rehabs, but more high end rehabs with MUCH larger profit margins. In 2008 and 2009 within my own business we did a TON of entry level housing rehabs in my market…..and even though I learned a lot and made great money doing it, I quickly came to the realization that doing a gazillion rehabs in order to make more money is not the best way to do this business. The only problem with the alternative, which was moving up market, is that it took big NUTS to do so at that point in the real estate cycle and pretty much nobody in my market was doing it. So what did I do……..well I jumped in head first of course! Once we did our first high end rehab it quickly became obvious to me that not only are the profit margins HUGE in comparison to the low end rehabs, but it was a whole lot easier to sell higher end houses (which seemed very counter intuitive)! We actually sold our first high end house within an hour of putting it on the market…..and it was a full price CASH offer for almost 800K!! Now 800K may or may not be high end for your market, but the point is high end is high end…..so just scale it to you market.

So what is happening out there in the market today? Well it appears a few other investors have now started to catch on to the fact that smart money has been sitting on the sideline for a number of years…..just waiting for house prices to bottom so that they could finally go buy that new and very impressive house for their family. The only problem (and its a great problem for real estate investors) is that there is almost no inventory to choose from. So right now there is a TON of built up demand for these higher end turn key houses, but very little quality product for them to purchase! This means when a quality high end house is put up for sale in most markets right now, they are selling FAST and for a large PREMIUM!

Now to be clear doing high end rehabs are not for everyone, so please don’t go jump into this niche chasing big pay day’s if your business is not ready for it! But if you have built the proper foundation in your business to be able to transition into doing some higher end rehabs, then I would absolutely encourage you to do so! There is a lot of money to be made, but it takes a higher level of experience and know how in order to take advantage of this opportunity. So get out there and start to analyze your market and figure out which neighborhoods high end rehabbers are working in……then start marketing for deals in those areas! Its that simple, so get to it!

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