A good time to flip?? (Phoenix: for sale, foreclosed, renters)

[Captain Bill]

Originally Posted by x3vegas

In response to Captain Bill's post - I would have to quit my job and move to PHX for three years to be a part of this...

Thanks for all of the responses so far. I will need to make a decision in one week.

I can tell you that one will not make $30k net on every property in the price range you state. That is the proper price range to target, but the spread is not that easy to get.

It will be very difficult to find and buy 2 homes per week that will provide the necessary spread, and that will take full time effort by several people.



I don't want to discourage you, but you need to answer some questions for yourself:

• Are you an experienced real estate investor
• Are you an experienced real estate rehabber
• Do you know how to do contracts with vendors
• Do you know how to do a cost analysis
• Do you know how to do a scope of work for contractors
• Do you know what desirable updates to do that will sell the property
• Do you know contractors/vendors in this area
• Do you know the Phoenix market
• Do you know which cities and communities in this very large metropolital area will be best for your project
• Do you know how you will be locating the properies to purchase

Now for some different type questions for you to ponder:

• Do you have a business plan
• Will you be paid a salary plus commission/bonus

These are not questions that you should answer publicly. It is food for thought so that you can be sure that you are making the right decision.

[markas214]

Originally Posted by Rick Lee

Do you feel the same way about day traders or anyone else who takes a risk to make a short-term profit? I'm not aware of any flippers forcing someone to buy a house they couldn't afford or apply for a mortgage they couldn't understand. Perhaps we'd all be better off with houses in need of repair being taken over by squatters instead of fixed up and resold by flippers.

The stock market used to be about INVESTING in a company that you believed was stable and profitable. Now it's all about short term gains, a giant casino for the insiders to bleed for their personal enrichment. Another example of why our current system needs massive overhaul. While nobody is being forced to buy from a flipper the impact these speculators have had on housing and finance in this country is indisputable.

[Ponderosa]

Originally Posted by markas214

The stock market used to be about INVESTING in a company that you believed was stable and profitable. Now it's all about short term gains, a giant casino for the insiders to bleed for their personal enrichment. Another example of why our current system needs massive overhaul. While nobody is being forced to buy from a flipper the impact these speculators have had on housing and finance in this country is indisputable.

You are lumping speculators and rehabbers unfairly, I think. The 2005 speculator bought on margin, invested nothing in the house, and then defaulted when the bottom fell out of the market. Today's "flipper" is buying homes WITH CASH that are nearly unsaleable because of damage/neglect, making repairs, and reselling them. Their activities are a good part of why housing has firmed and prices have begun to rise. They are doing us all a service at the moment.

[Vinny536]

Originally Posted by ArcticPhoenix

This person is part of the cause of our spiraling economy. If you were a true patriot, you would bring severe harm to this person.

So you expect people to want to buy trashed houses and fix them themselves? people don't even want to deal with their own oil changes!

Very few people want to take the initiative to buy a house that needs to be updated, then take on the labor themselves. the other option is to have the house full of strangers doing the work on a daily basis and i think most people value their privacy and security too much to really consider that scenario. many people see hiring a contractor as a risk. stories are entirely too prevalent about contractors taking money and never showing up again.

I would be willing to bet most buyers would prefer the turn key houses investors provide. I also feel most people buying homes that need work are buying the home due to price with the intentions of renovation later. I think 2 identical plans in the same development, one "flipped" with a higher price and one in need with a lower price would see the renovated home sell faster in most cases.

Perhaps one of our agents can add their input to this, i would love to hear it. especially if i am incorrect.

[x3vegas]

This discussion is very relevant...

In contemplating this opportunity, my wife brought up a good point. A good business plan needs to center around providing a SERVICE. Flipping to make a quick buck on the onset of a bubble and rehabbing homes are very different business plans.

Perhaps my original title was misleading. "A good Time to Rehab?" would have been more descriptive of my original intent.

The investor has a large sum of cash to fund this project, and owns a drywall company in the midwest. He views PHX as a market that could benefit from rehabbing homes.

[Ponderosa]

Originally Posted by x3vegas

This discussion is very relevant...

In contemplating this opportunity, my wife brought up a good point. A good business plan needs to center around providing a SERVICE. Flipping to make a quick buck on the onset of a bubble and rehabbing homes are very different business plans.

Perhaps my original title was misleading. "A good Time to Rehab?" would have been more descriptive of my original intent.

The investor has a large sum of cash to fund this project, and owns a drywall company in the midwest. He views PHX as a market that could benefit from rehabbing homes.

There was an article in the local paper today that said 90% of foreclosure homes are damaged and require various levels of repairs. You investor may have a point. But I would think things are the same in LV. Why not flip there?

[Bideshi]

If it can be unloaded, unload it. It's still a long way down...

[x3vegas]

Investor has a Broker/Relators who are in PHX who would oversee the rehabs and list the properties.

I think it is a sound business plan, but may not support the #'s I would need to move my family to PHX for three years...

Plus to be totally honest, there are people already intrenched in the PHX rehab market that may be more equipped to make this project a success.

[markas214]

Originally Posted by Ponderosa

You are lumping speculators and rehabbers unfairly, I think. The 2005 speculator bought on margin, invested nothing in the house, and then defaulted when the bottom fell out of the market. Today's "flipper" is buying homes WITH CASH that are nearly unsaleable because of damage/neglect, making repairs, and reselling them. Their activities are a good part of why housing has firmed and prices have begun to rise. They are doing us all a service at the moment.

No. I am replying specifically to Rick's post. Rehabbers actually add value not only to the rehab but the entire neighborhood. The OP seems to be more of a flipper looking for a quick buck than a rehabber. Local rehabbers have a stake in the region where as the OP and who ever it is they represent are looking to exploit it.

[fromcotoaz]

If you want a good Realtor, call Scott from Arizona Discount Realty. He can provide you with some great answers to your questions. He gives a 50% commission on homes purchased through him.