Has anyone has success in irvine with flips

Question

Eric C. · Answer

@Crisantos Hajibrahim: I think your contact got VERY lucky on those Phase 1 purchases at PP.  I think the 1MM net number might be a bit on the high side due to transaction costs + landscaping + upgrades.  I follow this neighborhood daily and haven't seen any examples of such extreme appreciation.  The only neighborhood that has done this is Laguna Altura and even then 500k/property net gain would be corner cases.

Look at the next phase of GP, Beacon Park.  You will see nothing close to the appreciation potential that PP had due to the initial high start price.  In fact, you will see price drops + extra builder concessions to get inventory moving.  Hopefully your friend didn't load up in BP.

Cori Chekhovskiy · Answer

I'm in Michigan. Do you mind if I ask what your unleveraged return is in MI? (Unleveraged cash on cash.)

Crisantos Hajibrahim · Answer

So I have a neighbor who does something I don't think I have the stomach for. He is basically buying houses in the great park (and i know some others who do this as well, but not on his level), he has about 10 houses in all, and he basically sits on them, rents them out, loosing some money on the rents...hoping he will sell them in about 2-3 years making a nice profit for himself. No cash flow. (all about appreciation) I am all about cash flow. One of the early houses he bought in the great park and sold - in their first phase (pavilion park) he cleared about a million in two years between the two houses. He is very bullish the housing prices will keep going up in the 92618 zip code. I have some hesitation with that strategy.  And the only reason I stay in Irvine, is because I understand it better than I do other cities. I don't know the other markets in the other parts of the OC on any level. I currently have about 5 rental homes in Michigan that I own outright and make about 8-10% return on my money every year after costs. I have two houses in Irvine, one that I live in and one that I rent ( I bought the rental house I have in Irvine at the bottom of the market-those days are long gone). When I do the numbers there is noway you can buy a house in Irvine, in this crazy market and make any positive cash flow like I do in Michigan. Hence why I am looking to see if someone is doing anything with flips in Irvine and see if I can tag along. And you're right about a lot of the things you say. I feel comfortable in Irvine and its just a preference that I feel comfortable with. I know another guy waiting for people to die in Laguna woods (Leisure world area) and doing flips and making a nice little profit for himself. Thats his little niche. But I thank you and the group so far for your feedback.

Polar Prutaseranee · Answer

Hello @Crisantos Hajibrahim. Irvine is a expensive niche. I currently flip in Orange and LA Counties. With so many new developments in Irvine, it's also a bit harder to find homes that need fixing. The ones that do need fixing are in the older parts of Irvine, and unfortunately, I feel that for the prices they run for, you may as well purchase a new dwelling for a little bit more. You said you know people who focus on Irvine and are doing well. Have you reached out to them? Most people I know flipping will survey a much larger area. In any case, good luck!

Joe Homs · Answer

@Crisantos Hajibrahim  that is a narrow focus, but good luck to you.

Joe Homs · Answer

@Crisantos Hajibrahim  I am flipping homes in Orange County and can meet with you to discuss investing. Let me know. I can meet you at my local Starbucks in Mission Viejo.