House Flip Opportunity?

Question

I moved into my neighborhood four years ago and keep running by this house that looks abandoned. I think it would be a good house flip but don't know how to go about it. I found the owner's name and the contact address is the home which no one clearly lives there. Based on the information I found, I suspect that the homeowner is an older person who can no longer care for it. The outside is disheveled with a couple broken windows, holes in the wall, and deck that is falling apart. Who knows what's happening on the inside. It would be a big reno job. However, I think it would sell well since there is high demand for our town and low inventory. The house is also in a preferred school zone on a quiet street. It's an established neighborhood with sidewalks and other families.

A little background information on myself. I am a residential architect so I am confident about designing and project managing a reno project. I would hire a GC to do the work. The house is nearby so I can walk over to check on it. I definitely don't have the funds myself to finance it so I need to figure that part out and run numbers. As I mentioned, I am new house flipping so I am looking for any insights or advice on what to do next, how to finance it.

Justin Hammerle · Answer

@Sia Herr - I would say your first step is figuring out whether or not you have seller.  You can use direct mail or door knock the property.  A house that looks like it hasn't been kept up can be a fair indication of an opportunity but in my experience there are a lot of stubborn owners out there that just don't care to sell.

Chang Zhang · Answer

Sia - I can likely track down the seller for you through a data provider I subscribe to. Am also Boston based.

Sia Herr · Answer

Thanks for the insight.

Jaron Walling · Answer

Agreed with @Justin Hammerle comment. We have had success buying off market so we chased properties like that last year. All walking or bicycling distance from our house. Distressed, high grass, no vehicles present, and seemingly vacant. I had an awkward chat with an owner mowing the yard, and a family unwilling to negotiate on anything. No motivation = no opportunity.

Spend tons of $$$ to get off market leads/call backs/glimpse of motivation, or look on the MLS with motivated sellers abound.

Steven Foster Wilson · Answer

Hi Sia,

The first flip you do will be one of the hardest because you are learning so much. I am so glad I did not go with the first place I looked at flipping. I would have for sure gone bankrupt. It needed so much work and at time I just saw a place that needed a little loving but it was way over my head. Starting out with simpler is always better.

You may want to make sure that you follow these top 4 tips that I have:

1. Do your research - Before purchasing a property, make sure you conduct thorough research on the location, the property's condition, and the potential cost of repairs. This will help you make an informed decision on whether the property is a good investment. 2. Know your renovation budget - You don't wanna overdo or underdo a property. Focus on the right improvements that will add value to your property. 3. Know your after repair value - The goal of flipping is to make money so you have to make sure you're not covering your all-in cost and you're actually making a profit 4. Time your sale right - When the market is favorable and the demand for housing is increasing, that's the best time to do it. This can help you avoid having to list your property for too long. Hope this helps and best wishes to your real estate journey! Looking to purchase my first property

Ariff McLaren · Answer

If the numbers make sense, I'll be able to connect you with a few buyers who are hunting right now - looking to close in the next month or so. Have you tried skiptracing for the owner's phone number? It might show multiple numbers and you might even get a family member's phone number but once you start making those calls, you're one step closer! I'm open to connect with you, I'd love to know more about the architect work you've been doing as well.

House Flip Opportunity?

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