How To Buy A House To Flip? If you never heard the saying: “You make money when you buy”, then write this down. This is the key to success. Basically what that means is you need to buy the house at the right price. You set your profit margins when you buy. This is very important. In this post we will explain How:
Buying the house for the right price does not ensure success, but buying it for the wrong price and there is no way to recover the loss and this before you even start any work!
Simple! Set Yourself Up For Success. Besides sounding like a fortune cookie, this is very important. It is pointless to buy a house no matter the bargain if no one is interested in living in that area. You will be stuck with a house no one wants to buy or rent for that matter.
.. no, I am not going to say it 3 times! You get the point.
Now often people will start talking about perfect school districts, conveniently located to shops and attractions etc. etc. Sure all that has merit, but what is actually important is the following. Is the location desirable, yes or no. If people want to be in the area then you are good to go. You have a pool of buyers!
In other words, “know what you are getting yourself into”. However bad the condition of the house, you better have a good idea how bad it is. You need to leverage ARV (=After Repair Value) of the house with the Repair Cost, against your offer.
I know you want to get to the flipping impatiently so I won’t make this too long. Just be sure you do the numbers, pray to the flippin Gods and hope you got the house at a good (yet fair) price!
As promised we will document the entire process, from beginning to end. Well it all starts by getting leads!
We do not do paid advertising (yet), but we are going to explore this option in the near future.
If you are a homeowner and you need to sell your house, there are great ways to do this efficiently. Find local home buyers easily in your area, no matter where you are
Direct mail marketing is where you send mailers out to potential leads in hopes they will reach out to you after reading your mailer in order to sell their house to you. Some commonly used Direct Mailing pieces include:
What you have to notice here is that the mailer is as good as the package it comes in. If the mailers doesn’t get opened, or read (in case of a postcard) it is useless and money spent for nothing on marketing. So the mailers needs to be noticeable and compelling.
Many “gurus” say, you can not create motivation. What this means is that if a seller is not motivated to sell, no matter what you write, it will not create motivation.
But I know for a fact that this is bullpoop! I have done many deals where the seller never even thought about selling their house until they received my mailer. Only then did they realize how much work it was to hold on to their property!
People think that direct mail marketing is as simple as sending a yellow postcard to as many possible people.
That is often why they are unsuccessful. The list is important sure. Your copy is important. and the day it arrives IS important. If you all want more details on what it takes to launch a successful campaign, I will write a separate blog entry just on Direct Mail Marketing. Just leave a comment below letting me know it is of interest. If enough comments I shall share our most treasured secrets to DMM.
SEO stands for Search Engine Optimization. Let’s try something out. Go to a new window in incognito mode. Do a search for “We Buy Houses In Connecticut”. What do you see? Oh you lazy bum, I’ll do it for you.
That is the most sought after keyword. Not only do we rank pretty high you see a picture of my partner Dixie on a HUGE section next to the results. Can ANYONE miss us when they search for how to get their house sold fast?
I think not!
This my friends is SEO Mastery! We ranked in but 4 months!!! Usually it takes about 8 months to rank on the first page, and if you want to rank 1… expect to wait longer!)
But we cracked the code!
Ohh I know what you will say.
“Ohh OK but MSOOTKAUG, your company name “We Buy Houses In Connecticut” is the same as the terms you entered to do the search, So of course google will favor your site and put your company info up.
Here is what MSOOTKAUG says to that.
RUBBISH! see below!
Even when we do not rank first for a specific city (with that keyword phrase), our big company profile is still shown!! (We do not yet rank for We Buy Houses In Waterbury CT…)
There you have it!
I am preparing for a trip to Zurich, for a robotics competition called the Cybathlon. Yes I know… what?!
But no one cares…
When I got back 2 weeks later, a motivated seller had opted into our site and filled in our form requesting we buy their house. I rushed to call him back in hopes he still needed to sell. And luckily, the lead was still hot. He needed to sell fast as the house was getting in very bad shape and the roof had issues. So I scrambled the jets and grabbed my trusty sidekick Dixie… wait wait… rewind.
Dixie.. you don’t know about Dixie, do you.
Wait let me fetch the Dixie.. give me a sec…
Exactly. The Dixie. She is awesome pretty hard working brilliant strong (she will kick your ass, as she competes as a fitness model!!
My image, logo and brand of the
company team. I hate calling it a “company”.
Ahum we scrambled the Dixie and rushed to the property. The seller told us the house was unlocked… wait what?!
So now we are curious!! We took the day off for a fieldtrip to the property.
When we got near we got very excited. Why?
We landed into Clinton CT. A coastal town that is very sought after. Beautiful quiet peaceful and very scenic! We definitely wanted to buy here so we were just hoping the house was in decent shape.
As we drove to our destination we just rolled down the windows and took it all in. The colors of fall were still lingering…
But back to reality. We finally arrived. We got out of the car and we saw the house…
This had to be the crappiest, ugliest house in a 15 mile radius.
To all you new investors out there, you always want to buy the ugliest smallest dumpiest house in the best neighborhood. Usually these will bring the best Return Of Investment, because the After Repair Value (ARV) is inherently large because of all the other big houses in the direct vicinity sell for a high price. So this brings the value up of all the houses in the area. JACKPOT!
So now you are wondering what the heck the house looked like huh. Easy seabiscuit!
Our eyes lit up and we did the victory dance Dixie and I! We love these kind of properties. Simple layout that works, needs a ton of cosmetic repair, structure was sound… We wanted this!
So we called the owner on the spot and gave him an offer. So here is why our offers are often accepted. We Never Give Low ball Offers! We simply look at the house, the condition it is in, the market value of all other houses similar to this one, and we give an offer that corresponds to a fair evaluation of the house. Period.
Often when you do this the homeowner can see where our offer is coming from and they have no reason to reject the offer if they really truly want to sell.
This way they get a fair offer and we get a fair sale! It works out for everyone!
He readily accepted our offer!
We have a property to flip. Step Aside HGTV, here come The Dixie and The Jerryll!… one is a genius (me) the other is insane (Dixie)…
The Dixie,.. The Dixie and the brain brain brain brain…
Don’t Miss it!